It’s always fascinating to see how Westerners idealize Japan on platforms like HN. It makes me wonder(i'm korean): how would a Westerner react if they saw me romanticizing the Mondragon cooperatives in Spain? They’d probably find it strange and out of touch with reality.
This essay on Japan's corporate diversification and physical tacit knowledge is an interesting read. However, as an East Asian, my assessment is that this system is heavily driven by Japan's unique, subtle classism. It's a highly collectivist society with strict age-based milestones and immense pressure to secure traditional employment. In Japan, your corporate affiliation often dictates your social standing.
The author paints the lack of shareholder pressure as the secret behind their successful diversification. While true for a few, the flip side is that it created a massive 'zombie company' problem—a heavily discussed issue in Korea and Japan that the West seems largely blind to.
Also, the idea of a 'horizontal culture' in Japan is a myth, especially in software. Even a glance at the Japanese web(5ch, onJ etc...) reveals a deeply entrenched vertical hierarchy. In my experience working with Japanese developers, their reliance on the legacy Waterfall model and an exhausting chain of approvals and reporting was far from horizontal. (Though I admit my sample size is small, it heavily contradicts the Western narrative).
I agree that this rigid system fosters the tacit knowledge needed for hardware and materials. Still, it proves that we all tend to project our fantasies onto cultures we don't fully understand. The divergence in perspectives on HN never fails to amuse me.
> It makes me wonder(i'm korean): how would a Westerner react if they saw me romanticizing the Mondragon cooperatives in Spain? They’d probably find it strange and out of touch with reality.
Quite the opposite - for me, anyway.
FWIW, as a Westerner, I find the Mondragon Corporation to be fascinating and something I've read a lot about because there's no way we've figured out the ideal sort of setup for a business (or government, or any sort of human organization, given appropriate context) in the year 2026.
We have a lot to learn, and while "different" doesn't always mean "better," I strongly believe being exposed to "different" is necessary for us to devise novel approaches to human organization.
Because the only certainty is there is no ideal sort of setup, just a set of probably decent options for the current conditions, which are highly changeable. The only thing that is certain from a benefit maximization perspective is there are a lot of companies much larger than minimum efficient scale that we should probably antitrust out of existence to increase competition
I had a couple of eye-opening conversations about this the last time I was in San Sebastian. Not everyone there loves Mondragon as much as we think, some see it as a closed club that makes it arbitrarily hard to get a job with them depending on your connections. I met some workers unhappy of their hiring practices and I think their starting working conditions. No idea if they were fair or just resentful.
I still admire Mondragon and wish there were more companies like it, but now I try to remind myself that most characterizations from the outside are surely lacking in nuance.
Yeah the problem with co-ops is that every new employee means reduced profit-sharing for existing employees. Ironically, companies in SV actually have a nice solution to this problem: Employees get equity, but newer employees get less than older employees. So from the perspective of old employees, it still makes financial sense to hire new employees, because the old employee equity becomes more valuable.
In technical econ terms, the marginal profit of new employees is typically below the average profit of existing employees. A profit-maximizing business only cares that the marginal profit is positive, and will hire until there is no additional profit to be made. A co-op is incentivized to keep average profit per employee high, which can mean reducing headcount in order to keep the average strong. So that's why co-ops can have a sort of exclusive club feel to them.
SV is actually an interesting example which proves how employee ownership can drive prosperity, but the typical co-op crowd doesn't want to talk about it because it's too capitalist-coded. In a way, SV companies show that employee ownership is not some sort of instant cure for everything which ails capitalism.
These arrangements lean into "third way" and distributist economics. You might find John Médaille of interest. He's written some books[0] about the subject, some articles[1], and given a talk at Google[2].
In the US, the American Solidarity Party[3] draws from distributism, for instance.
In Homage to Catalonia, George Orwell narrates just how little fighting there was. It was trench warfare where both sides had precious little ammo and guns that couldn’t shoot straight. He sat in the mud at the front rotting with the rest. Apart from a few days in cities, hospital recovery, and a desperate last few weeks.
He had to flee the country because his chosen party was purged. He survived a street battle. Then made a final visit to many of his comrades in prison.
Don’t presume that his views were shared with those who had influence.
He had admiration for his comrades in arms, especially the mess hall staff. He was on the workers side, but he was in the banned party, of the losing side of the war.
Above all, Orwell saw through the propaganda at home and the rest of the worlds deliberate misunderstanding of the whole situation. For instance, he saw that France had a tacit agreement with the Soviets to slow-walk supplying arms to the Nationalists, to ensure French financiers had protected investments in Spain’s railroads. And every newspaper outside Spain reported like Fox News.
There are aspects about cultures which can be fascinating, not (only) because they are foreign and new, but because dedicated and intelligent people have been improving them for generations, centuries even. I have a friend who is from Korea and who is a wood worker, and we have compared the different approaches to what, in the end, solves the same problems. Not everything can be incorporated into the other way of doing things, but I have found it eye-opening. My brain still tries to find ways, comparing, like a constant ping. Maybe one needs to dedicate 100% to the new way for a while to understand it fully before a genius brain would be able to find the spark how to meld both methods into a single improved Way of Doing Things (tm).
What article were you reading? This article isn't idealizing Japanese companies, and specifically discusses the drawbacks of the Japanese approach, including zombie companies.
The article's thesis statement isn't "the Japanese approach is better," but that business practices like these bundle together, that they're very difficult to change, and that each bundle has different advantages and disadvantages.
Ironically, you've proved a deeper point about how amusing HN is: we all tend to project our fantasies onto the articles we're discussing, even if we didn't fully read or understand the article.
I did read it, but my impression remains the same. While the article does contain critiques of the Japanese system, as an East Asian, I feel it completely misses the actual underlying dynamics.
I know the author isn't trying to paint Japan as a utopia. The reason I call it 'romanticized' is because the author claims Japan's success in precision parts is driven by 'horizontal' and 'collaborative' practices. That just isn't true.[1]
In reality, this system is largely sustained by the ruthless squeezing of subcontractors (for the record, I am Korean, but I actually like Japan), which is a massive social issue there. It’s very difficult for me to understand how anyone could view this structural dynamic as collaborative or horizontal.
If the author had concluded that their success in these niches stems from being an extremely vertical society where defying your superiors is simply not an option, I would have fully agreed. That aligns exactly with what I have experienced firsthand.
>"The andon method is really the J-mode in miniature. Information flows laterally, authority to act is widely distributed, and the people closest to the problems are the ones who fix it."
Does your definition of a 'horizotal culture' actually mean forcing people to work overtime just to hit deadlines? Are you sure you haven't completely confused 'horizotally' with 'top-down'
P.S. The link I provided is an official directive from the Japan Fair Trade Commission (JFTC) explicitly warning large corporations to stop ruthlessly suppressing their subcontractors' labor costs.
The “Just-in-Time System” amounts to the exploitation of subcontractors. As a Japanese citizen, I am well aware of the reality of the Japanese economy. While server resources can be scaled up or down with a simple command, scaling physical factory resources is not so easy. Inevitably, this leads to suppressed wages for employees. Furthermore, while labor unions exist within large corporations known as “keiretsu,” they do not exist in subcontracting firms. There are laws in place to protect subcontractors, but in practice, they do not function (because if a subcontractor were to legally sue a major corporation, they would lose their business).
This country’s economy is built on the sacrifice of others.
Walmart and Amazon ruthlessly squeeze their suppliers. They achieve low prices on some things and try to corner the market on others (and then raise prices). What I don't see them achieving (to the contrary, I see them failing spectacularly at) is the quality control that some Japanese companies excel at.
So there has to be something more to it than that.
When U.S. giants like Walmart or Amazon squeeze their suppliers, the natural consequence is cost-cutting and a drop in quality control. But for regional companies in Japan and Korea, regional mobility is incredibly difficult. In Japan, for instance, even politics is often "hereditary," and there is a strong overarching tendency for people and businesses to stay rooted in one specific region (while many do migrate to Tokyo, a vast number of people simply do not have that choice).
In the highly fluid U.S. corporate ecosystem, mobility is always an option. If a supplier loses a contract with Walmart, they can still pivot to another massive retailer, even if it's not quite as large.
Japan and Korea, however, have small landmasses, and the reputational risk is absolute. If a company's reputation is damaged by a single failure or a lost contract, their next job simply vanishes. Because of this existential threat, they fundamentally cannot compromise on quality. Imagine what happens to a small supplier in Japan if they are cut off by a mega-retailer like Aeon Mall. There is no backup giant waiting to take them. They are finished.
So, while geographical and structural differences dictate this extreme pursuit of quality, framing it as a "horizontal culture" is completely wrong. As an East Asian, I can confidently say that "horizontal culture" is the single most mismatched term you could possibly use to describe East Asia
If you are from the West, navigating East Asian culture can be exceptionally grueling. At a fundamental level, our societies tend to be inherently exclusive toward different races.
Do you have a good book, article(s) or podcast to recommend on this topic (business culture in East Asia, or a specific country), in English & approachable by Westerners, while not giving just a cartoon overview of the issues?
The focus of the article is on why Japanese corporations excel at so many different areas. Are you saying that all the factors it mentions, like employees being trained as generalists, life-time and so on, are completely irrelevant? or are you saying they are important but some other essential factors were left out?
> In reality, this system is largely sustained by the ruthless squeezing of subcontractors (for the record, I am Korean, but I actually like Japan), which is a massive social issue there. It’s very difficult for me to understand how anyone could view this structural dynamic as collaborative or horizontal.
This is the picture painted for me by the article. Vertical integration eliminates subcontractors. Horizontal integration squeezes them.
> If the author had concluded that their success in these niches stems from being an extremely vertical society where defying your superiors is simply not an option, I would have fully agreed. That aligns exactly with what I have experienced firsthand.
Same story here. When switching jobs is made difficult, the incentive is not to make waves.
> Does your definition of a 'horizotal culture' actually mean forcing people to work overtime just to hit deadlines?
Exactly, I was confused too. The authors clearly mention what the parent comment talks about, albeit towards the end of the article, that the 'J' bundle meant that these firms were not set up for success once they 'caught up' and were required to innovate not just process but from the ground up to envision new categories (e.g. iPhone).
Thank you, I was confused reading the comment above, because the article pretty clearly laid out the benefits and drawbacks of the system. I didn't see any idealizing.
I didn't feel like this article necessarily idolized it; the author seemed pretty even-handed about strengths and weaknesses.
The interesting question in all of these kinds of things is "are there ideas we can take to gain the strengths of other systems or patch the weaknesses in ours?". Looking at Japan specifically, I think I speak for most westerners in saying that if we could get a little more stability and less financial-quarter-driven behavior without taking the whole kit of lifetime employment and zombie companies, that would be a good thing. The author points out just how bundled that is, so it's a tough nut to crack.
One model that does give us that is the 'Untouchable visionary CEO' of Jobs and Musk, but I think the popularity of that approach is also limited, partially because of all the not so visionary CEOs trying to be Jobs, and partially because working for those guys is terrible. They inevitably seem to become tyrants.
Most Americans I know are familiar with the unending work culture of Japanese white collar workers (if only a parody version of it), and want no part of it.
Interestingly this article argues very strongly that you cannot have some of those things without taking all of them. That the various aspects of corporate culture reinforce each other and make performance worse if taken piecemeal.
> Thinking about your primary job: On average, how many hours do you work per week?
Not really sure they are measuring what they think they are measuring. This being more pronounced amongst young people may be because working long is being seen as less and less cool, as there has been a major vibe shift among young workers regarding their relationships with employers. Doesn't necessarily mean they are actually working less, might mean they don't want to admit it.
Revealed concrete hours would be much more trustworthy
> it created a massive 'zombie company' problem—a heavily discussed issue in Korea and Japan that the West seems largely blind to
Zombie companies in the west are mentioned as a low/ZIRP phenomena. But the west shouldn't have as big an issue with those because companies, when less diversified, get killed off more often by interest rate hikes.
Zombie companies exist in Europe; at least part of the euro crisis was exacerbated by the continuing cascade of bankruptcies making other banks insolvent.
The EU’s crisis schemes like furloughing employees en masse dull the pain but also do prolong some companies’ lives. The US historically has had much more brutal impacts but quicker recoveries.
I'm a german software developer working for a japanese corporation in a german subsidiary. I agree with pretty much everything in your post. Especially the exhausting chain of approvals and also the unwillingness to make quick/tough decisions feels like walking through molasses at times.
However, there is also an upside to this. I can actually confirm that they take quality control very serious, probably due to the losing face cultural thing if the product fails the customer and therefore rarely do quick last minute changes or crunch, because it degrades quality.
I worked for a software consulting company in Japan, we had a contract with a big well known company. The contract gave a precise date for the delivery with huge fines if we delivered late but there was also a long bug fixing period after the initial delivery.
So we had overtime for 2 months working from 10am to 4am just so that we could deliver the "feature complete" software. If any bugs were found they were classified as either blockers (feature cannot be shown without) or scheduled to be fixed after delivery.
My boss knew it was stupid, he didn't like it but it was the standard contract from that big Japanese company and we were small and they weren't going to change that.
As a fan of Nintendo (the games, not the company of course), this definitely checks out. There are exceptions, but you rarely see a new Zelda game release in the state you can expect from Bethesda.
Almost nothing in this aritcle matches the reality of my experience in Japan. Horizontal culture? In in my experience. Everything you do requires approval in triplicate. Do the wrong thing at a company and you'll get screamed at by the person who feels their job is under threat from you trying to step out of your precribed role. There's absolutely no such thing as "generalist employees" at any Japanese company I know of. I have no idea where the author got this idea.
Japanese and American companies have different purposes.
In Japan the corporation primarily provides stable income and employment for society, and secondarily returns on capital invested. In America, corporations primarily provide returns on capital invested and secondarily provide stable income and employment.
This shows up in the data too. Japanese corporations are less likely to go out of business but provide worse investment returns. American corporations provide better investment returns, but the citizens have to deal with layoffs.
Most citizens would prefer stability to growth, but I think the tradeoff has a lot of downstream consequences.
> Most citizens would prefer stability to growth, but I think the tradeoff has a lot of downstream consequences.
People want personal stability, which in our current society means a stable job.
That doesn't have to be the case, though.
Overall, economic growth is good for society as a whole, so it makes sense that a state should encourage it as much as it can.
This means that what is good for an individual is not the same as what is good for society.
I think the ideal solution would be to keep the risk-taking in business that you need for good growth, and instead provide stability through strong social support services, like healthy unemployment insurance or UBI. That way, everyone can take risks to try to drive the economy forward, but not starve if things go poorly.
> Overall, economic growth is good for society as a whole, so it makes sense that a state should encourage it as much as it can.
The problem with basing the language in the aggregate, is implies that distribution doesn’t matter, and all modern economic models agree. This is a big problem for the reality of people living in ever increasing inequality. Money is a competitive resource, we use it to bid for real resources. If constant economic growth disproportionately goes to the already wealthy, it worsens inequality when resources to exploit become more scarce. It’s one thing to have massive swaths of untouched natural world to exploit for human benefits, but those days are long gone IMO.
Inequality is not "ever increasing". You should resist the urge to say everything is constantly getting worse just because that makes you look more sympathetic to the poor.
(A worse issue is that inequality decreasing can mean things are getting worse for everyone.)
If you see how Japanese CEOs live, they live a far more deprived life on the backs of their employees than any billionary CEO in the USA. Japanese companies are centered around treating most employees like indentured servants in a sweatshop so the few bosses can have giant expense accounts, vacation houses, company cars, etc.
That is true, but at this point in time, looking at wealth inequality in the US for comparison feels pointless, as the US can't be seen as a humanoid society anymore. By that I mean the riches of the Top 1%, and the "soon" attitude of the bottom 80% in the US feel alien, surreal, and perverted to an extent it stopped being useful as a measure for humans.
Depends what you mean by "control". If you don't own a nice house, car, driver etc. but your company just happens to provide it as a perk, then you still have it.
Japanese CEOs have a Toyota Crown in their garage and spend each Friday night at a kyabakura/hostess bar with a few employees. They take a trip to Hawaii twice a year.
American CEOs are on the board of 8 companies but spend 5 minutes a year combined at the offices of those companies. They spend their weekends at private islands off the coast of the US Virgin Islands with other billionaires. They fire employees who ask for health care benefits or a day off. They actively endorse political candidates who went to the same private island with them and who will lengthen working hours, reduce benefits, and make it easier to fire employees. They want global surveillance to track anyone who's ever even considered saying anything bad about them. When it's possible to inject ads directly into our brains, those CEOs will force their employees to do it.
As an American who's been in Japan for a very long time and worked at Japanese companies, Japanese companies don't pay big bucks, but there are fewer deranged ultra rich people within them.
At the biggest ones you start to see branches of the organisation dedicated to c level services... Things like a driver awake and ready to go 24/7 (for the whole family), purchasing or even building apartments.
All available in the west, but the distinction is who directly pays for these things.
Stability is preferred to growth in the moment, but in retrospect and in comparison to others most people don’t want to give up what they have and go back in time.
And arguably growth could lead to better overall stability in the long run, as people find employment in new companies at higher wages over time with lower overall unemployment.
>Japanese and American companies have different purposes.
In Japan the corporation primarily provides stable income and employment for society,
Are you Japanese? Because this doesn't match what I know about Japanese companies, like Sony for example, who operate in a very American way.
Your image on Japanese vs American companies feels like the copy and pasted idealistic impression of what American redditors imagine Japanese companies would be like, rather than reality.
Failed businesses also tend to provide lower returns on capital, and that’s totally backed up by data. Doesn’t mean the “purpose” of those companies was to provide lower returns on capital.
> if they saw me romanticizing the Mondragon cooperatives in Spain?
Speaking for myself, I'd find that very interesting! I just stumbled over an article about it a few days ago, and don't think it's weird that different parts of the world would be interested in a regional business phenomenon.
In my opinion, this comes from the 70s and 80s where there was very real concern that Japan was going to surpass the US economically. Many companies in the US attempted to adopt Japanese methods in manufacturing and other areas, media then inherited further Japanisms. There is also an historic backdrop of westerners viewing Japan as a mysterious civilization on the far side of the globe dating back to the 1500s.
Westerners are taught by the media and education to idealize Japan and hate China almost everywhere. They present cherry-picked aspects of both countries that make China look bad and Japan look good. In reality every country has its good and bad aspects.
This is just part of the propaganda machine and what politicians want you to believe, in an effort to align their populations to be supportive of their foreign policy and military motives. That ultimately trickles down to things like this. When people come to HN, or any place, with rose-colored glasses of Japan, they will seek confirmations of that rose color everywhere.
> Westerners are taught by the media and education to idealize Japan and hate China almost everywhere.
As an American educated by the American public education system and indoctrinated by American media, our government is certainly stupid and vengeful enough to make me want to support this if it were true, but it's just not. The much more banal truth is that Japan is extremely talented at exercising soft power by projecting a favorable image of itself via the media it exports, whereas China is just comparatively terrible at exercising this sort of soft power.
I suspect that’s related to China’s lower levels of individual freedom relative to Japan. Censorship does not fit well with producing powerful and influential cultural exports like manga, anime and video games.
On idealizing Japan, people here seem to think it's benefic and pushed by Japan, where I think it's more complicated. If the goal is to keep the US customers and workers in a state of fear and adversity, you need a credible threat from a somewhat powerful enemy, and idealization becomes needed.
That was Japan a few decades ago, that lead to the bashing movement, and I think it kept going t a smaller pace still, while China got set as the next unstoppable threat.
Not being a single-party, notionally communist dictatorship may be helping with the image too? I don't know, spitballing here.
I think the default approach in the West - and that's not a US-specific thing - is to treat exotic faraway lands with a mix of curiosity and awe. But China is a geopolitical rival with a political system that rightly makes many Westerners queasy, so it doesn't benefit from that anymore.
I don't think there are many people in the West who profess love for the UAE. But there are several reasons why it's not as disliked. First, it's a monarchy, and monarchies are harder to parse, given that many European countries are notionally monarchies too. Second, it's not by any stretch of imagination a serious geopolitical or economic threat to the West. Third, although it is authoritarian, by most third-party assessments, it's not nearly as authoritarian as China.
People seemingly often forget how brutal Chinese authoritarianism can be. I don't know whether it's the fault of the news or if it's selective amnesia, but there are few worse cases of authoritarianism than the country that welded people into their apartments.
You're giving people too much credit. People in general simply do not care about whether or not a government has committed atrocities, even when that includes their own government, as long as they think (rightly or wrongly (usually wrongly)) that atrocities won't be happening to them.
Is it propaganda though? Japan is more aligned with ‘the west’ not only in geopolitics but in the system of governance that was imposed upon it by via USA occuptation. Whereas China has a very different political system that is generally poorly understood and distrusted. Regardless, I don’t know where you’re from, but I see plenty of idolizing of China and how it manages to solve big problems at speeds unseen outside of mobilization in other parts of the globe. China-studies are a big thing at the moment. The positive view of Japan probably flows from its postwar boom years and popculture exports. China is at the moment being viewed with suspicion over its military buildup near Taiwan and creeping authoritarianism under Xi. This could all change again in the future depending on the actions China will take.
> but I see plenty of idolizing of China and how it manages to solve big problems at speeds unseen
This is actually a great example for extant romanticization of China. People lauding Chinese expediency in the context of industry and construction often don't realize it's almost entirely enabled by extreme underregulation and underenforcement of industrial safety standards. Chinese people themselves will often point this out, though depending on the person they may frame it more in a style of "The West is slow because of all of the red tape!"
Of the subset of Westerners who are aware of this, sometimes I have to balk at how many of them will take that framing to heart and paint it as a positive thing. Even most Chinese don't have a positive view of it, not in reality. At most it's a tragic necessity required to build China up, though younger Chinese rightly tend to see it for what it is: corporate exploitation of laborers.
Of course in the context of solving political problems, the Politburo readily cutting through its own invented problems is another matter.
Does it? I’ve seen Ezra Klein talk about his book and he talked about how bureaucracy is frequently a scapegoat for getting things done. Europe is very bureaucratic yet is able to build. The issue he called out is red tape yes but more so litigation by the private citizen. That any individual can stop an apartment being built because it blocks morning light into their flower bed
They're made possible because all but the most frivolous lawsuits are not disincentivized, but are in fact tolerated as a tacit, systemic feature by the state and the bar association. The example given is a stalling tactic. Stalling tactics also exist in China through property rights, it's a weird thing to hold up as contrast. Having a right to the house you own is such a fundamentally important thing to have in a society. That it can be abused because bureaucracy will tolerate it out of epistemic humility doesn't change that fact.
It’s hilarious to me all the progressives like yourself absolutely losing their shit over someone saying they want government to be more effective and accomplish things instead of just spending tons of money and nothing actually changing.
Can you please tell me which politician runs on making the government worse? No single electoral campaign has ever said "I'm running to make the government less effective." Trump ran on making the government more effective, Harris ran on making the government more effective.
Turns out you need more that just vague platitudes than "things should be better."
No shit dude. Welcome to the ground floor everyone agrees with.
This is why EK is such a fucking dork. Go follow some organizers with your preferred beliefs, that would do you better than listening to the smart boy thinking very smart things and if you disagree with the smart boy you aren't a serious adult.
> People lauding Chinese expediency in the context of industry and construction often don't realize it's almost entirely enabled by extreme underregulation and underenforcement of industrial safety standards
Kind of like Tesla's latest factories, or DR Horton building homes with massive problems from day 1?
Or Silicon Valley being a collection of superfund cleanup sites?
Or just the environmental pollution, in general, in Texas?
No one has figured out how to balance growth with safety. Ideally it shouldn't be hard, the total amount of money saved is pennies compared to the overall investment, but making everyone follow the rules via regulations ends to being a huge cost and time multiplier.
The more direct comparison is the blue collar working conditions throughout the west in the late 19th and early 20th centuries actually. It is true that environmental protections could be much better in the United States, did you assume I would disagree or find it shocking? Why?
> but making everyone follow the rules via regulations ends to being a huge cost and time multiplier.
The cost and extra time it takes saves lives. That's the bottom line. It's your attitude that gets people maimed and killed.
> The cost and extra time it takes saves lives. That's the bottom line. It's your attitude that gets people maimed and killed.
My argument, and I should have made it clearer, is that we are paying a huge penalty for people who are dishonest. The amount of money they save by being dishonest and endangering others is generally tiny, but the cost to society to prevent the dishonesty is huge in the form of regulations.
Hate China? I don’t see that. There are plenty of factual reports about the CCP that are pretty damning, but the people/culture/place is generally perceived postively other than being a competitor…
You seem to be an American so I'm very confused. You'd have to be willingfully blind at this point to not see the anti-chinese propaganda that has been going on in America for (at least) the past decade.
This is a not even wrong sort of misunderstanding to the realities of real politik. Your confusion is simple. You are unaware of the geopolitical games played at this level.
It is true there is anti Chinese propaganda but that is neither here nor there since posturing in this way is simply what competing world powers do.
Look past the institutional framing. The citizenry of all countries on this world are in reality on the same side far more often than opposed. The average American worker, Chinese worker, Russian worker, all want the same things: stability, prosperity, a future worth living.
It is in the self interest of states to promote nationalism and construct out-groups.
But that does not mean ordinary people should internalize such division. A wise citizenry knows to separate the notion of geopolitical competition from hatred towards ordinary citizens/culture of other countries, no matter what the state apparatus tries to tell them.
From what I’ve seen, the opposite is often true. Western leftist mainstream media frequently portrays Japan as a racist and declining society.
Meanwhile, on platforms like YouTube and communities such as Hacker News, the bias is even much stronger. China, along with the broader “Axis of Resistance” and third worldist camp (though China arguably doesn’t fully belong there), is often praised, while the West, including Japan, receives disproportionate criticism.
I disagree. People still trade, travel, and visit both countries regularly. Even if some media outlets are biased against China, that doesn’t mean Japan need to be idealized, it proves nothing. Your comments come across as more like propaganda.
> part of the propaganda machine and what politicians want you to believe
Alternatively it could be due to emergent outcomes from our societies and systems.
Is there a word or concept that explains the idea that "people in power are controlling us"? Maybe the word is related to hierarchy? I also see it in conspiracy thinking (Rothschild, lizard people). The assumption that somebody is in charge manipulating us, and that we can discern their motives based on what their incentives are imagined to be.
A past example might be the red menace - which appeared to me to be part of US culture (politicians pushed it but I think they also took advantage of a natural us-versus-them zeitgeist). People seem to collectively desire a labeled enemy (you also see it about sports teams).
Or see the sibling comment "banal truth is that Japan is extremely talented at exercising soft power by projecting a favorable image of itself" where manipulation is imagined as the base cause. I just don't see the world that way (apart from the scientific difficultly of discerning cause versus effect in human systems).
Maybe it is just all memes.
Individually even very well educated people don't seem to see systems and effects of systems: e.g. every thread about economics e.g. politicians pretending they are in charge when systems have fucked them.
I really don't really think there's much political or propaganda interest in getting Westerners to idealize Japan, at this point.
Now back in the 80s? Back in the 80s, despite being aligned with the West, they were perceived a lot like China is today. Everyone was scared that they were going to start eating the West's lunch and various negative stereotypes and exaggerations started to bubble up: it was a futuristic land, but a futuristic land of suicides, with little drone-like salarymen crammed into little shoebox apartments the size of a Western bathroom, working 20 hour days.
Between the Plaza Accords and the bubble bursting and decade after decade of Lost Decades, the Japanese threat was successfully neutralized. I think Cool Japan is mostly something they've earned for themselves, frankly.
> Now back in the 80s? Back in the 80s, despite being aligned with the West, they were perceived a lot like China is today. Everyone was scared that they were going to start eating the West's lunch and various negative stereotypes and exaggerations started to bubble up: it was a futuristic land, but a futuristic land of suicides, with little drone-like salarymen crammed into little shoebox apartments the size of a Western bathroom, working 20 hour days.
Yep. A lot of cyberpunk fiction from that time that demonized corporate influence and power was inspired by the rise and perceptions of Japanese technology companies.
I can remember one of the American news magazine shows, maybe 20/20, showing a Japanese school with long hours and intense discipline and contrasting it with fat, illiterate American kids (the same stereotypes were made about the Soviet Union).
A lot of the perception of Japan, especially among Gen X and younger, is influenced from exports of Japanese culture. Nintendo, JRPGs, Manga, Anime, and even the quirky stuff reflects well on the Japanese though American eyes. No propaganda is needed.
> it was a futuristic land, but a futuristic land of suicides, with little drone-like salarymen crammed into little shoebox apartments the size of a Western bathroom, working 20 hour days.
Not really? If I were to describe the issues inflicting the west, none of too-small homes, high suicide rates, or an economy based on long hours of white collar work would immediately come to mind.
Rather, the west seems to be characterized mostly by insanely expensive housing caused by an extreme antipathy towards denser housing as populations grow, and a K-shaped economy where white collar coastal elites are actually doing relatively well but everyone else - namely blue collar and service workers - are doing worse and worse. Suicide rates aren't rising dramatically, and are nowhere near where they were in Japan at their peak in the 80s, which itself was always overstated (they were higher than they were in the US at the time, but were comparable to many other western countries).
for what it's worth, back when i was in b-schoo, the predominant theory for the existence of large, diversified Asian conglomerates (Japanese keiretsu is a prime example, but it's not unique to Japan. Similar entities exist in S.Korea and Thailand, among other places) is the friction of starting and doing businesses in these countries. Startups there have such a hard time getting funded and landing clients, that the financing aspect alone give the conglomerates enough of an advantage to edge out startups, despite the inefficiencies typical of large organizations (and in this the Japanese corporate giants are no better than IBM or GE).
this theory is typically mentioned when introducing the Theory of the Firm, i.e. why do companies exist at all? why not everyone just freelances, and when you need a marketing/finance/legal/coding person, you just contract one on the free market? the idea is that there are always frictions when doing business with someone new (is this person good? trust worthy? how do i find out?), and how much friction there is determines how big the firm will grow (to incorporate functions in-house, or expand to other industries).
in a perfect frictionless economy, it could indeed be true that business transactions all happen at the smallest unit, i.e. the individual. at the other extreme, there would just be one firm that coordinates all economic activities. all real world economies sit some where in between.
I think it's the density of Californians, and that Japanese culture, food, second language etc. is popular there probably not least due to their relative proximity.
If HN was Brit-dominated, while less romanticised perhaps we probably would seem oddly fascinated with say France, to our minority members elsewhere.
I think one thing that's happening is that they're good at things we're frustratingly bad at, and bad at things we don't even realize we're good at, so they get used as an example an awful lot.
It's not at all like in the article, it's not horizontal, and very much hierchcal and rigid.
And it can be seen in japanese software, it looks like it was designed from request sheet without actually understanding why. It's often nonsensical and extremely convoluted.
Most of the good japanese software is actually developed in the west by subcontractors.
For example Sony games
Thank you for this post. I am a "Westener" who lived in Japan for 6 years. Boy, was that eye-opening in terms of "the map and the territory". Basically nothing is what it seems to be - and unfortunately the positive things mostly turn out to be nationalism-motivated make-believe, wishful thinking, or only made possible by extremely lax attitudes to amassing public debt (any country could make the trains run on time if they were ready sell their future for it).
Western Japanophiles, especially from the US, and even if they speak the language and have lived there, are mostly ignorant and their idea of Japan is a full phantasy.
The UK is in the process of spending £100billion of public debt to build a “high speed” train line to connect the northern cities to London. Except it’s been shortened in length to not connect those cities and will instead run only to Birmingham less than 200km away, keeps getting reduced in speed, and can probably be guaranteed not to run on time. So for me it seems like any county could make the trains run with infinite money, but in the country which invented the train we still can’t.
Yes, objectively these characteristics of Japanese corporations seem like inefficiencies in the "free market".
Lack of mobility across companies (no price discovery on wages), lack of specialization (no focus), age based hierarchy (anti-meritocratic). None of these sound good for a well-tuned system.
I suspect much of Japan's stagnation is due to this system.
I pretty much agree. While any semblance of a "horizontal" dynamic in Japanese software development was perhaps realized in embedded systems around 40 years ago (e.g., rice cookers with fuzzy logic, or, in a different sense of _lateral_, Gunpei Yokoi’s famous philosophy of "Lateral Thinking with Withered Technology"), software has traditionally been undervalued in Japan. This historical neglect has ultimately contributed to the decline of our consumer electronics industry. (Though personally, I still don’t see why a toaster or a fridge needs to be connected to the internet.)
IMO, the tight-knit division of labor between Toyota and its subcontractors is a slightly different story from the broad diversification within a single corporation. While the latter was historically bolstered by strong industry-academia ties (often driven by university cliques), we rarely see this kind of broad diversification happening in recent years. That said, Japan's traditional "membership-based" employment system, combined with a cultural reluctance to shut down unprofitable business units, is likely what has allowed this diversification to persist for so long.
In any case, Japanese companies are currently struggling with the friction between their traditional corporate culture and the superficial adoption of Western concepts like DX, Agile, meritocracy, job-based employment, and a startup-centric mindset. I suspect Korea might be facing similar structural clashes, though perhaps you are adapting at a much faster pace.
Agree with the meta point. I worked in Korea and Japan and loved the culture but when I moved to the west I was surprised to see how people over here fantasize about their (imo inefficient) corporate cultures.
This particular article was decently nuanced though.
As someone who finds Japanese corporate culture interesting or even desirable in some ways, it definitely doesn't seem like the most efficient way to run a company. And I'm sure there are plenty of cultural aspects that would not be my cup of tea.
I've worked for an American megacorp and the branch office of a Japanese company. The Japanese company felt a lot more humane on balance, though it doesn't express as well when I write it.
The Japanese company had some rituals were a bit weird, but harmless/charmingly quaint like mandatory volunteer days, keeping a copy of the founder's precepts on my desk for executive walkthroughs. They also had some bad tendencies, like praising employees for being there at 6AM/8PM. If something didn't work, they'd give it a bit of runway to see if it could pull through before cutting back. When there were layoffs, it was the whole division failing (each division competed with the others). It's hard to imagine what kind of political statements would have been offensive to that employer, it was just a neutral job. Really, the worst part was subpar compensation (and I still felt spoiled compared to Japanese coworkers).
My next job was at an American megacorp. The executives would give a holiday speech about "social responsibility" and how well we were doing, then layoff a factory. The employer was constantly involving themselves with US national politics, but employees were expected to refrain from having political opinions of their own.
> The employer was constantly involving themselves with US national politics, but employees were expected to refrain from having political opinions of their own.
Reminds me of my first job in state government where the incredibly underpaid workers had to go through bureaucratic paperwork if they needed a second job to pay the rent (ostensibly because of the conflict of interest risk)
Yet the governor was a known slumlord. I’m sure there’s no potential conflict of interest there.
> The employer was constantly involving themselves with US national politics, but employees were expected to refrain from having political opinions of their own.
You’re right and that’s intentional. Japanese companies don’t optimize for efficiently but for longevity. Sometimes those things go hand in hand. Sometimes they don’t.
I'll preface this by saying there are lots of other factors at play, but here's an interesting one I can speak to personally:
Car culture. We're a very car-centric society, and the Japanese auto makers have been a part everyday life to 3 full generations of Americans now. Even most Baby Boomers are too young to remember a world without Honda or Toyota. Across all age groups, a lot more Americans grew up with a fondness for their family's Toyota than their family's Hyundai.
I grew up in middle America. Both my grandfathers were "GM Men" if you will. Partly by vocation, partly by culture. On both sides of my family, every car was either a Chevy or a Buick. When my folks bought a Honda in 2007, it was treated like a scandal. But yknow what? Now one of my cousins has a Hyundai, and nobody batted an eye. Things are changing, even for the "raise hell praise Dale" crowd.
Japan's car makers, and their other industrials have a 40-year head start on embedding themselves in the American zeitgeist. Sony, Panasonic, Canon, Yamaha, they've all been here a really long time. They're loved because they're familiar. That's a bias, and I think that bias colors the way we talk about east Asian businesses more broadly.
> We're a very car-centric society, and the Japanese auto makers have been a part everyday life to 3 full generations of Americans now.
I assume "we" are Americans.
I keep writing this over and over again on HN: There are NO highly developed non-micro states that are not car centric outside of major cities. Yes, literally, Japan, outside of a few large cities, is incredibly car centric. Sure, the cars are small and cute, but it is defintely car centric!
> Sony, Panasonic, Canon, Yamaha, they've all been here a really long time.
They came for a single reason: To avoid import tariffs. Please stop romanticising this for any other reason.
I think when people criticize America for being car centric, they mean that even urban and suburban areas often rely solely on car travel (e.g. Houston). Cars in rural/less developed areas are perfectly reasonable.
I think the criticism is misguided. In Japan, Saitama and Kanagawa prefectures (north and south of Tokyo -- the commuter belt), huge swaths have very poor mass transit. They drive a lot! Pick any mid-sized Japanese city: Most people are drivers. There might only be two train lines in the whole city. With the exception of the three (maybe five) biggest cities in Japan, people living in suburban areas are all mostly drivers.
Yeah and this is the exact reason why people call the US car-centric. Only in the US the large cities are car-centric too. You just proved the parent comment's point.
> They came for a single reason: To avoid import tariffs. Please stop romanticising this for any other reason.
You're hallucinating. There is zero romanticization in the parent comment about why they came to the US.
> There are NO highly developed non-micro states that are not car centric outside of major cities.
That's an argument. Lack of density means that public transportation is hard to have enough scale. But the US is uniquely bad at both density but also lack of transportation options. In countries like the UK and France (just because I'm familiar with them, I'm not claiming they're the only ones or it's something unique to them) even small towns have a regular bus or train connection to elsewhere. Might not be the best frequency, but it's there. In the US even multi hundred thousand people cities have literally nothing other than cars as an option.
So there are layers of car centricity. And considering most people live in cities, in countries like most of the developed world, the majority of the population has the option of at least decent transit. You know which countries are the exception.
Hat tip. I agree (and concede defeat). To be honsest, normally I am only replying to (anti-public-transit) fanatics. You are the first (in a long time) that provided a well-balanced reply!
There is also a distinction between "has a bus system" and "the bus system is actually usuable". Say you want to take the bus to jury duty, but calculate that you would need to wake up at something like three in the morning to catch the so-and-so to downtown, and then another bus out to where the jury place is (trip time: multiple hours, assuming all goes well), in addition to the usual playing Frogger across a stroad or two, or even more walking to maybe find legal road crossing facilities for humans, assuming they exist. And that was in a city with a relatively good (for America) bus system.
> They came for a single reason: To avoid import tariffs. Please stop romanticising this for any other reason.
Where did I suggest they came for any particular reason? I just said they got here first. They've had more time to become entrenched in people's lives than the Korean or Chinese companies that followed. That's all! Nothing "romantic" here!
At no point did I indicate any nostalgia for the idiosyncracies of the "GM patriarch" family. Is that what you're suggesting?
And yeah, "we" is Americans. As evidenced by the sentence that starts with "I grew up in middle America."
I genuinely don't understand this comment. It's like you saw "we're a car-centric society," stopped reading, and started typing.
What? All of these companies have been major importers to the USA since the 80s or earlier. I don't see how tariffs have anything to do with how embedded Japanese electronics and cars are embedded into American culture.
Yep. Growing up in the 90s, Japan was the undisputed king of cool, affordable entry level sports cars. RX-7, Integra, Impreza WRX, et al.
Yamaha, Korg an Roland were the defining instrument producers of the 80s and 90s. Few things have altered the course of popular music as much as the TR-909 and TR-808, M1, DX-7, Juno, Jupiter. All of electronic music grew out of those.
The Walkman and Discman were iconic.
Honda was building P3 and ASIMO. The PlayStation 1/2 and Nintendo 64/GameCube were a thing.
I didn't even get into anime, the language or music from there until decades later. But all of the cool things came from Japan back then. Honestly, they still kind of do.
As the owner of a Juno 106, I can't disagree. In the 90's, to me, it was Panasonic video gear that I found amazing. Had to take apart a couple of toughbooks tonight, and they are great little machines.
Although, to me, what I've always loved about Japan is how they will take every medium that arrives on the scene and treat it with loving craftsmanship. From jazz to skateboarding to yo-yos.
Exactly. There's a lot of value placed on expert craftsmanship or just...being an extreme nerd about some niche thing, as well as on the act of creating things. Whatever you're interested in, there's some random person in Japan who's really good at it.
It resonates with me, because I get uncomfortable if I do too much passive consumption and am not making something.
Not about the article but I have the exact opposite impression of HN treatment of Japan. It's largely expats complaining about living in Japan or Westerners comparing Japanese values to their own and always concluding the former is inferior, not just different. It feels like a modern form of imperialism to me. I'm surprised you get a positive impression (yes this particular article is an exception though).
>While true for a few, the flip side is that it created a massive 'zombie company' problem—a heavily discussed issue in Korea and Japan that the West seems largely blind to.
Oh, we're getting there. It's just a bit fringe right now, but Meta's $90 billion loss on VR and *gestures at various aspects of the Gamestop situation" and a few other incidents have people asking questions that are uncomfortable for the passive investmend fund crowd. Forget zombie companies; by many measures, America has a zombie economy.
It’s that passive investing has become a self-fulfilling prophecy, because regardless of the company situation the funds have to buy the shares at any price, which has made it simpler for incumbents to grow and stay growing while burning profitability to the ground. Hence why there’s been a recent change to the rules on the Nasdaq so SpaceX/OpenAI/Anthropic can be included on the indices 15 days after IPO rather than having three months of price discovery on the markets first before index funds start having to buy huge amounts of their shares and keeping their (likely imaginary) price afloat.
It’s a huge structural flaw in the markets right now, yet it seems a flaw that isn’t really going to break anything which is weird in itself. I can’t help but feel that Wall Street is going to find the right place to kick at some point in order to have the whole house of cards come tumbling down for a while so they can buy cheap and negate/steal years of contributions from people buying index funds. Not sure how or when but I’m sure they’re working on it.
Well - there is a giant push to allow non-qualified investors to invest their 401k (and roth and whatever) into the private equities market - pre-IPO companies and such.
I can't shake the feeling of a grand fleecing incoming - and honestly, most big financial companies I know are against it because the blowback of inevitably bankrupting the firefighters&nurses pension fund will be congressional hearings and piercings of corporate veils.
Seems like the feds are pushing for it - for reasons I cannot fathom.
In Japan, your corporate affiliation often dictates your social standing.
This is absolutely true in the US as well, by the way. People will treat you differently if you work for a FAANG company. People take a lot of pride in telling others they work for one. And we even have a word for someone who used to work for Google, for instance.
Yeah, a friend of mine from college works for Waymo (Google-adjacent) and I've overheard wives of local friends bugging their husbands to try and work him for an in.
>This essay on Japan's corporate diversification and physical tacit knowledge is an interesting read. However, as an East Asian, my assessment is that this system is heavily driven by Japan's unique, subtle classism. It's a highly collectivist society with strict age-based milestones and immense pressure to secure traditional employment. In Japan, your corporate affiliation often dictates your social standing.
Related: In most of the world, carmakers separate out a luxury brand from their other products: Honda with Acura, Toyota with Lexus, etc. In Japan, they don't. The explanation I usually get is that the culture primarily associates luxury with "being attached to the big-name corporation". So you don't really improve on that by introducing another smaller brand, even one you build up as luxury.
See also the patio11 comment:
>>My salary was $30k, but there is some tangible value in having a pocket full of business cards which practically read "Attention, person who has just been handed this card: give the bearer whatever he wants. We're good for it. If you don't, we will remember." That status is very much not the same as the one you get if you combine two part-time jobs into the same level of income.
Acura has never been used in Japan. NSX and Integra are Honda models. Toyota introduced Lexus domestically in 2005. Their older Lexus models had Toyota equivalents, often as variants of the Toyota Crown which was their original luxury tier car.
That is accurate. Acura and Lexus were brands created for the US market. The original Integra was badged as Honda in Japan and Acura in the US, for example. A TLX or whatever is just a top trim Accord.
Lexus didn't enter the Japanese market as a brand until 2005, prior to that all Lexus models well sold under the Toyota moniker in the Japanese market. I'm not sure about Acura, but the GP's assertion is largely correct in its directionality.
I can confirm this is true for Acura. I owned an Acura Legend and the same car was sold in Japan (well, the right-hand drive version) as the Honda Legend. I had seen pictures of them online in the 90s, but happened to see a Honda Legend in person when I was in Tokyo some years later.
I'd say so. Not on all the branches of the cooperative, but it generates over €11 billion in annual revenue and employs more than 70,000 people with a very stable business. It might be a bit tricky to gauge success when the rewards and incentives aren’t quite the same as in your typical capitalist company, though.
> It makes me wonder(i'm korean): how would a Westerner react if they saw me romanticizing the Mondragon cooperatives in Spain? They’d probably find it strange and out of touch with reality.
In his science fiction novels, Kim Stanley Robinson frequently incorporates the Mondragon economic model to explore post-capitalist, worker-owned, and cooperative societies. I'd say KSR is a decently well-known S/F writer, so at least some westerners (and I'd assume many in this site) have already some idea of it. But I'd say it's true that it's easy to romanticize these kinds of singular situations and brush over the problems they might have.
This is the first I've heard of the Mondragon cooperatives, and I quick peak makes me want to learn more about them -- I'm enamored with the idea for coops.
Did you read it? I can see how you can come to this conclusion devoid of context. This is actually a topical article - mainly because it is a surprise to many that a toilet company could be one of the biggest winners in the AI pick-and-shovel trade. These names have just recently been hoisted into the spotlight. It's not really a romanization but an explanation of why.
Did you read the entire article? There is a whole section on where western model excels. The article is not about romanticizing Japanese culture, but to tell a story about how and why Japanese and American firms tend to differ. I am sure that it paints in overly broad strokes at times, but I really did not get the impression of idolization, idealism, or even oriental mysticism.
I did read it, but my impression remains the same. While the article does contain critiques of the Japanese system, as an East Asian, I feel it completely misses the actual underlying dynamics.
I know the author isn't trying to paint Japan as a utopia. The reason I call it 'romanticized' is because the author claims Japan's success in precision parts is driven by 'horizontal' and 'collaborative' practices. That just isn't true.
In reality, this system is largely sustained by the ruthless squeezing of subcontractors (for the record, I am Korean, but I actually like Japan), which is a massive social issue there. It’s very difficult for me to understand how anyone could view this structural dynamic as collaborative or horizontal.
If the author had concluded that their success in these niches stems from being an extremely vertical society where defying your superiors is simply not an option, I would have fully agreed. That aligns exactly with what I have experienced firsthand.
> is because the author claims Japan's success in precision parts is driven by 'horizontal' and 'collaborative' practices. That just isn't true.
> In reality, this system is largely sustained by the ruthless squeezing of subcontractors (for the record, I am Korean, but I actually like Japan), which is a massive social issue there.
Well that's just like your opinion...man. I think you're both singularly wrong. Trying to attribute a single factor to a highly complex system is a fool's errand.
If your conclusion is correct "ruthless squeezing of subcontractors" are there other cultures whether there is true and the country has been successful in precision parts? Otherwise, it's pretty impossible to conclude the causality.
It’s Stockholm syndrome. Japan really spanked the highly established U.S. auto and electronics industries in the 70s, and many people now look to kaizen, Kanban, etc as serious cope.
As a westerner (UK) I massively idealise Mondragon and wouldn't find it weird if anyone else did. Cooperatives are fascinating and the question of workplace democracy needs more consideration.
The author discusses the zombie problem. I don't think the author is romanticizing this system. Instead, he is explaining why this system exists (as a result of WW2-era industrial reforms that were kept in place instead of discarded), and why that system naturally leads to a certain set of outcomes. West Germany also had to rapidly catch up after WW2 to suit America's Cold War purposes, and there are some similarities to J-firm structure there, but I'd be interested to hear the author's take on why it ended up somewhere else.
> It’s always fascinating to see how Westerners idealize Japan on platforms like HN
Most HNers tend to be in their mid-30s to 50s so a lot of Japan-philia does appear to stem from an older mental image from the 1990s to 2010s.
> This essay on Japan's corporate diversification and physical tacit knowledge is an interesting read. However, as an East Asian, my assessment is that this system is heavily driven by Japan's unique, subtle classism. It's a highly collectivist society with strict age-based milestones and immense pressure to secure traditional employment. In Japan, your corporate affiliation often dictates your social standing...
The Japanese Keiretsu and later Trust Bank model is the norm in South Korea, Taiwan, China, and other Asian countries as well due to a mix of colonial, financial, and policymaking ties.
This is still a form of orientalism which OP is pointing out. Japanese people don't work better or worse than anyone else, and most commenters think all yellow faces look the same and thus can't differentiate between a Japanese, Chinese, or Vietnamese working behind the counter at a konbini let alone other services jobs where Westerners are most likely to interface with.
> and most commenters think all yellow faces look the same and thus can't differentiate between a Japanese, Chinese, or Vietnamese working behind the counter at a konbini let alone other services jobs where Westerners are most likely to interface with.
This seems quite presumptuous, and not all that different from the orientalism you're accusing OP of.
Orientalism in the standard definition means the Western tendency to view non-Western societies in an "othered" or exotic gaze, be it in either a pedestaling or derogatory context.
Think yellow fever, weebs, ad nauseum conversations about Japan (and Asia in general) on HN and Reddit.
You are correct.
Japans system was ahead of its time back then and was heavily imported into Korea. The flaws I pointed out are not strictly a Japanese problem it's really an issue shared across all of East Asia.
1. Japan has become much "chiller" from a work culture perspective, with hours worked being comparable to those of the UK and Ireland [0] thanks to regulatory changes in the 2010s.
2. While conglomerates remain prominent, a new generation of large Western-style employers like Rakuten, Mercari, LY, SoftBank, etc have arisen and operate with American-style (and -educated) management, and the stereotypical "salaryman" lifestyle is on it's last legs.
3. Japan has quietly become an immigration driven society. A major reason behind the rise of Takechi's faction in the LDP as well as Sanseito is because of the post-2019 immigration boom [1]. Going from less that 1% overseas born residents to around 4% in roughly 5 years was a massive shift socially and impacted both blue and white collar employment in Japan.
4. Japan has culturally shifted to be accepting of an offensive military posture. You see this shift in Japanese media (eg. SnK, Nippon Sangoku) as well as Japanese foreign policy [2]. A more muscular Japan with a chip on their back is arising.
5. Younger Japanese are more open to calling out tourists and Westerners when they do weird or weeb s#it or treat Japan as their own Disneyland. They now treat Westerners the same way they treat other non-Japanese people now. The mindset shift I've noticed is an "us" (which now includes Koreans and Taiwanese) versus "them" which now includes everyone else.
----
Ironically, I think contemporary South Korea is closer to the image that HNers have of Japan versus Japan today.
I'd largely question the accuracy of point 1 IN PRACTICE.
Japan is notorious for uncounted and unpaid overtime, vacation days no one takes, and paternal leave you'd better not think of if you don't want to instantly become your division's outcast.
I worked in a host of countries, including the UK and Japan (the latter about a decade ago - I'd be surprised if things had diametrally changed since that time). The actual work hours are not remotely comparable.
(In fact the UK is one of the locales where I worked the least in terms of actual hours. Much less than in France, where they're supposed to be slackers... So generally I call BS on these stats.)
Yes but 2 ends up being a good check on 1 in the higher productivity ends of the knowledge work economy in Japan. I'd disagree a bit in degree to what alephnerd says and additionally think a lot of the actual "zangyou" ("overtime") work that Japanese do today involves drinking with the boss or going on business trips, but think his comment is largely correct. I also think the insistence in Japanese doing on-site work in Japan leads to a lot of inefficiency that Western businesses and governments have largely left behind 10-15 years ago.
I actually find the Western unawareness of how Japan has become an immigrant society, especially in service roles, to be hilarious. It's by far the biggest Japanese social change in the last 20 years probably up there with growing acceptance of LGBT lifestyles and is a massive, divisive political issue in Japan now. Also further goes to show how much idealized othering happens in these discussions.
The average konbini service worker a foreigner interacts with in Tokyo is going to be an immigrant. 12 years ago, I only met a handful of immigrant service workers.
> I also think the insistence in Japanese doing on-site work in Japan leads to a lot of inefficiency that Western businesses and governments have largely left behind 10-15 years ago.
A lot of that is operational as well - historically, the only other country with a large Japanese speaking population was South Korea, but salaries there have largely aligned and the post-1990s generation switched to concentrating on English instead of Japanese fluency. China has started to fill that gap though (hence why Chinese immigrants in Japan are viewed the same way as Indians are in Canada).
Basically, a company that whose entire internal documentation, communication, archive, and processes were always in Japanese will always bias in favor of hiring Japanese fluent employees, most of whom live in Japan and are Japanese.
You see the same thing in European countries as well, but the difference is it's easier for a German or French company to find talent somewhere else that is German or French fluent (eg. Turkiye/Poland or Morocco/Romania/ respectively).
The newer gen companies have a strong English muscle, but those are also the kinds of companies that are happy shifting hiring overwhelmingly to India or ASEAN.
Sorry I don't mean Japanese firms hiring Japanese workers, I understand that's largely due to language fluency. I meant how much in-person work happens in remote branches. So many Japanese shakaijin friends at Japanese companies are taking constant business trips around the country to do things that a video call and an email thread would do in the West. It helps that transportation in Japan is ubiquitous and cheap so it's fairly easy to go on-site, but it still ends up wasting a lot of time and productivity that I don't think Western firms have to deal with.
See, this is the issue. Karoshi/unpaid overtime in white collar work largely ended as a practice in Japan by the 2010s due to legal changes and enforcement via the 2018 labor reforms and a tight labor market.
Yet you see the same tropes peddled ad nauseum. I may as well use the same priors for Poland in 2026 as I would in the 2000s then when it was Europe's punching bag.
> It’s always fascinating to see how Westerners idealize Japan on platforms like HN
I think HN'er are smart enough to not idealize everything about Japan.
For example you can be in awe about how clean and safe the country is and how precisely on time all subways train are without idealizing toilet that stream water up your arse.
Nothing of this is particular to Japan, it's only the way it manifests in Japan that is adapted to its rich culture. Zombie corporations, corporations with ties to the government, family owned companies, monopolies, cronyism, all of this has been a staple of Western capitalism for centuries.
> It’s always fascinating to see how Westerners idealize Japan
Replace 'Westerners' with Americans and you are spot on.
I have never met any European that glorifies any part of Japan (I'd see Asia as a whole), most of them will tell you how the tall buildings make them feel little and how the society is beyond oppressive.
Whatever meritocracy exists in capitalism is ironed out by those rigid hierarchies.
I am not sure what is appealing about Japan, Korea or any of these parts of the world, to me they are full of plastic, sugar and late stage capitalism that makes the Americans look as socialists.
I do strongly suspect that a certain type of male likes these places for reasons I cannot even hold in my mind for more than a few seconds.
I've thought a lot about (and I don't mean this in a derogatory way) the weebu phenomenon. I remember encountering it first in college when I met people who were in an anime club. It wasn't for me but my philosophy generally is "let people enjoy things".
I will say that it often goes beyond "idealizing". I'd use the word "fetishizing".
I've wondered how much of this stems from being disaffected by the modern (particularly Western) world. I worked with an ethnically Chinese guy who was a massive weebu and that always struck me as odd given the Japan-China history.
Japan has always rubbed me the wrong way: misogyny, racism and denial about Japanese war crimes in WW2 mostly. Also the salaryman work culture. I see videos from Japanese workers and life honestly looks miserable. It's also a country that is dying. The samurais, ninjas, Ronin, shoguns, etc are cool though. Japanese history is fascinating.
My hot take here is that China is actually what people idealize Japan to be. China has the most competent government in the world and it's not even close. It's not problem-free. Nowhere is. But the transformation in the lives of ordinary Chinese people over the last few decades is unbelievable. China pulled ~800 million people out of extreme poverty.
It could be worse than Japan too. I think South Korea is that. As a non-Korean from the outside looking in, South Korea looks like a dystopian run by aristocratic (chaebol) families where the birth rate is the lowest in the world and it's in fact so low that if nothing changes, South Korea simply won't exist in 3 generations.
I don't think the parent commenter is arguing that living in feudal Japan was cool, or idealizing it. They are just saying Japanese history is fascinating, which it is. Just like ancient Roman is fascinating, or ancient Greece, but I wouldn't want to have lived there.
> But the transformation in the lives of ordinary Chinese people over the last few decades is unbelievable. China pulled ~800 million people out of extreme poverty.
By abandoning the policies that put them in poverty.
The story of China in the 20th century is largely one of missing the bus of the progress that was happening around them. The mechanization of Japan enabled the atrocities you mentioned because China refused to see the writing on the wall (from a balance of power perspective, Japan doesn't get a pass for what they did). Then, when they finally do have a revolution, they end up joining up with the group that weilds absolute power and causes catastrophic famine.
In the 21st century, they've slowly begun adopting western policies and are reaping the benefits while eroding their previously disasterous national policies.
The CCP has become more prosperous as it's become more like Hong Kong.
Japan will remain Japan regardless of how outsiders choose to view it. I’m not sure why China or Korea need to be brought into the discussion for comparison. Saying this as a proud Sansei living in America.
South Korea is partly replacing Japan with this Western idealization, right? Kpop, K-everything. And it's also a dying country, like you said. And also a mirage, the K-pop phenomenon which looks cool from the outside is all about exploitation, extreme control, and unhealthy fandom obsession from the inside.
My form of autism is going on deep dives into political and history topics and I'm not gonna lie, I've watched a super-long video essays on the 4B movement, neo-confucianism and the chaebols. This [1] I think was one of them.
I've never been to South Korea. I'd like to go to Seoul. For me though, South Korea is a cautionary tale in what happens to a country when a handful of families get to control all the wealth, all the good jobs, all the good university places and so on while the working class gets squeezed ever more. There are cultural issues here too that are distinctly Korean, namely that women are expected to have a demanding job AND have children, look after those children and take care of the house (traditionally).
I agree with most of your points. However, I can't quite agree with idealizing China completely (frankly, I don't think any government in the world is all that great). China has its own deep structural issues, such as the massive disparity between Tier 1 and Tier 2 cities, the grueling 996 work culture, and the 'Tangping' movement. That being said, I can absolutely vouch for your deep understanding of Korea.
So 996 is still a thing but the government is trying to stamp it out [1]. Tang ping is also something the government is dealing with (agree or not) [2]. One of the big problems in China right now is youth unemployment [3], which is (IMHO) related to Tang ping. That is, for a lot of young people (in the world, not just China) feel hopeless, like they have no future. This is exacerbated in China because of the gender gap (30+ million more young men than young women) as a consequence of the One Child Policy.
Young people in general aren't stupid (again, in general, not just China). They can look around and see they have limited opportunities, will probably never own a home, won't ever be able to retire, will have crippling debt (for college in the US), etc so it's natural to look around and say "what exactly is the point?" and, in some cases, just opt out. In the US you see this with things like "van life", moving to cheaper countries, tiny homes or just spending all your money on experiences because, to you, you have no future. I thin kreligion historically played a huge role in getting people to do those things anyway. But now, why would Alfred Q. Zoomer live paycheck-to-paycheck doing a shitty job just so Jeff Bezos can have slightly more money?
China at least has invested in eliminating poverty, building infrastructure (eg the high speed rail network) and transforming the lives of everyday Chinese people. Like I see Tiktoks from a rural Chinese woman who works in a shoe factory for $11/day but only really spends $1/day to live. She lives in a modern house (20+ years ago it was a rundown shack), has Internet, watches live streams, rides everywhere on an electric scooter and pays for everything digitally (of course).
Part of China's current woes are that Xi Jinping quietly just popped the real estate bubble and declared that houses are for living, not speculation. That market has been correcting itself for years ever since. But that's a long-term good.
I'll take the transformation of Chinese lives (not just in Tier 1 cities) over what's happened in coal mining country, the Rust Belt and agricultural communities in the US. It's not even close.
I suspect your information might be out-of-date because I've seen videos of tourists in Tier 3/4 cities (let alone Tier 2) and honestly it beats most US cities. There's no official list of tier cities but Chongqing is widely considered a Tier 2 city. Chongqing is widely called the "cyberpunk city" [4].
> you have a firm that has lots of lifetime employees who can’t be fired, and whose skills are tailored to what your firm needs rather than to a particular occupational category transferable to any employer
> the system only makes sense if the company is also insulated from outside pressure
> the J-firm [Japan-style company], run by its employees and largely indifferent to the interests of shareholders, exists simply to continue existing
> And that basic impulse toward survival is why Japanese companies are so insistent on diversification. If you’ve made a commitment to keep people employed for life, then you need to create jobs for them if their current jobs stop making sense
> If you’re not very worried about profitability, and have lots of well-trained generalist employees, then it makes perfect sense to reinvest your company’s earnings by expanding into new industries
Japanese might value status more than money. That is, status confers them higher societal 'value'. Some people are motivated by status, some by money, and some by a combination of both. These can be fine-tuned. If you can cheaper CEOs for a lot less money, why not? If you want to think about it, the top bureaucrats in any country command massive empires and budgets. They work for the power/status, not a whole lot of money.
One interesting thing about US is that money is worshipped, sure, the super rich billionaires live differently, they can have massive mansions with domestic staff, drivers, live life large, but they are completely outside of society. For people in the 0 - 100m+ range who are forced to interact with each other, there is no big high-status attached to the rich, their lives are a little bit better, but people aren't talking/treating them special. Compare this to a third world country like India, everything is a status marker, if you have a car you are treated a lot better than someone without a car. The outward displays are wealth/status are critical for day-to-day interactions.
As it should be. The pay gap from CEO to bottom tier worker is now obscene (21 times in 1965 and ~285 today). It's the foxes looking after the henhouses.
If we declared concentration of too much wealth in an individual a national security issue, there is no end to the kinds of levers we could pull. I’m hoping things like this will be the natural consequences of allowing the current administration to run almost unchecked.
This approach is basically crying wolf, only works once or twice.
After that ‘national security issue’ becomes a running joke. A bit like calling everyone a terrorist, or (very fashionable in the 1960s) communist to achieve your goals.
Promoting an environment in which worker-owned companies might thrive could help. (ie favorable business loans or other ways of securing capital other than private investment)
Last I looked at the most cited version of that ratio, it was comparing Fortune 500 CEO total compensation—including incentive-based stock appreciation—to economy-wide average hourly wages.
That makes about as much sense as comparing top 500 Hollywood actor earnings (including residuals) with the day wages of the folks showing up in TV commercials and as film extras.
The BLS keeps statistics on Chief Executives in general, and pegs their median wages around $200k:
Not sure why the left cares so much about CEO to work pay ratio these days, especially when Marx himself recognized that ownership was the true source inequality. A CEO is just a really well paid worker. Even CEOs who become billionaires do so from capital appreciation more than compensation.
A CEO is not "just a really well paid worker", don't be ridiculous. If you have the power of hiring and firing, or have enough money to not have to work for your subsistence, you are not a worker in any leftist sense.
A CEO is a worker incentivized to maximize profits to maximize compensation. And nowadays they see other workers not as a profit center, but as a blockage to their next big payout.
So yes, it is a problem when leadership doesn't have long term aspirations for the large company.
Sure, but ownership being the root of inequality was the one thing that he was actually correct about. CEO to worker pay ratio is something that is completely irrelevant. Companies spend orders of magnitude more money on its shareholders (dividends, buybacks, and reinvestment) than executive compensation.
Maybe others see it differently than I do, but the actual spending isn't so much the issue. It's the fact that these people with so much money exist at all. That much money translates to a tremendous amount of power which allows them to bend the law to their will.
Is there any large-scale economic or political system which does not contain a group of elites possessing "a tremendous amount of power which allows them to bend the law to their will"? Not a theoretical one, but one existing in real life.
Global societies were still mostly agrarian in his time. His analysis doesn't work well for the modern era with <5% engaged in farming. Central planning won't work. You need distributed decision making to be flexible for changing circumstances. You need capital for industrialization and you need a cadre of people who can take risks to invest surplus capital into new ventures. The large disparity in wealth is a problem, but some is necessary.
I clicked on the article to learn, "why Japanese companies do so many different things," and then got hit with pages of low-bitrate context, such that my eyes started glazing over and it was difficult to find the answer to the question. So I appreciate their compression, or at least pointing to where the answer is found.
Not only is that implication rude, it's just not true. I am at least in the 95th percentile of amount of reading. I just think the article is poorly written. Not everyone is a good writer these days (or any days).
Yes, thank you for compressing it. They start their answer with:
> Here is the answer I want to suggest: Japanese companies excel in lots of very different domains because it’s inherent in how they’re structured.
Which is then backed by some economists saying something similar (generally), but all of which completely ignores Japan’s specific history.
As a better example
Of examining Japan, here’s a look at Japan’s monopolies, how they were broken up, and partly how that effected the future of their industry:
> This is very different from how most wealthy countries operate. American firms, for example, tend to prioritize focus above all else
It hasn't always been like that. Western companies, including US companies, used to have lots of diversification as well (maybe not as much as the Japanese, but much more than today's companies still: not that long ago a company like IBM used to make mouses and keyboards, in addition to their photocopier, mainframe, software, and personal computer business. They even made a hydrogen peroxide analyzer in 1982![1]). They did so because it makes the company more resilient, and because in that time their shareholders wanted the companies they invested in to be resilient, to have a reasonable yield/risk profile.
Things changed in the 80s, when deregulation generate a boom in financial products. Then, individual company resilience was seen as obsolete, you'd cover your risk through portfolio diversification and all you'd want from a company was the pure yield, and companies were streamlined to make as much profit as possible, everything reducing the ratio being sold or terminated.
Fast forward 40 years, people believe it has always been like that and it must be so kind of deep cultural difference between Asia and the West.
True. I started my career at HP when it was being changed from a company where you spent your entire career and worked on lots of different things to a more "modern" and "focused" company. It was a sad transition to watch. This article brought back a lot of memories
Another example is the Honeywell corporation: from thermostats to computers, then parts of defense/aerospace. Looking at its wikipedia, it also seems like one factor of diversification was the WWII war economy where the government paid lots of different corporations to build new stuff: https://en.wikipedia.org/wiki/Honeywell
Correct, and specifically, it was the total focus on "shareholder value" which caused this, as most often splitting the company and selling its parts brought more immediate value to shareholders. If that also brings more long-term value could be more difficult to assess.
Funny you mention IBM given that it still has its fingers in many porridges (to butcher an expression), maybe not computer peripherals but it's still a very broad company.
I mentioned IBM because my in-laws used to work there, and they both ended up out of the company because of two waves of "let's focus on our core business" restructuring.
While things like the expectation of lifetime employment (or at least very long tenure) may sound appealing, it also creates a job market with very low fluidity. In practice, if you miss that narrow “fresh out of school” hiring window, you can end up facing pretty unfavorable prospects later on.
People can still get hired mid-career, of course, but many companies traditionally hire based more on long-term potential than immediately usable skills, since they expect to train employees heavily through OJT. That also means the number of openings for experienced hires can be relatively limited. And because of the seniority-based structure, even experienced workers may end up starting near the bottom anyway.
There was an entire generation of people who missed that initial hiring window because of economic downturns and hiring freezes, and many of them still struggle to land stable permanent positions even today.
Things are gradually changing, but many structural assumptions are still there. For example, parts of the legal and employment system are historically built around the assumption of lifetime employment, which also makes it difficult for companies to dismiss permanent employees once they are hired.
My experience in American organizations is that products and services need to not just make money, but make a lot of money. There is zero appetite for things that make a little bit of money relative to the cash cows of the company. You could say this is in part focus, but it is also based on internal accounting. Small product lines are saddled with total company overhead costs even if they do not apply to said product or service. Not good or bad, but it can lead to strange situations where you have a successful product that everyone complains doesn’t make any money.
> zero appetite for things that make a little bit of money
For obvious reasons, the expected rate of return needs to clear the hurdle of the risk-free interest rate. This puts a pretty high floor on activity that is "worth doing". This is a mechanism by which the phenomenon of ZIRP diversifies economic activity.
The risk-free interest rate is a pretty low floor for returns though? At least in my experience with expectations of what counts as a profitable project.
The risk-free floor is around 4% these days. Because the return on any other use of capital must be risk-adjusted, the breakeven might be 6-7%. That is roughly a 3x higher rate of return than you needed to breakeven when the risk-free rate was ~0%.
Small absolute changes in risk-free interest rates cause many things to become unprofitable when the relative change in interest rates is large. A risk-free rate of 1.0% and 1.5% are both small but the latter is 50% higher than the former.
Yeah, but my experience with what is considered a profitable project is firmly in the two-digits percentage range. Anything single-digit would count as a fairly low floor.
A lot of it depends on the risk. For something that has a profile more like venture you might need a 15-20% return. There are also fixed overheads so you also need an element of scale.
You characterized the risk-free interest rate as “a pretty high floor”. I find this surprising. How are 4–7% gains a pretty high floor? Year-to-year fluctuations often already are in that range.
> There is zero appetite for things that make a little bit of money relative to the cash cows of the company.
The other side of this is only new baby firms invest in that thing that makes a little bit of money. But given enough refinement, that thing starts making more and more money as it gets better and better. And soon, that new baby firm outshines the incumbent. The incumbent's wasn't incentivized to invest in the thing that started off worse but eventually became the new model. Think Kodak with film-vs-digital cameras.
This was the thesis of 1997's The Innovator's Dilemma, written by the guy who coined "Disruptive Technology".
On the flip side if a small part of the company is suddenly making a ton of money, urge investors will demand it be spun off into a separate corporation to “realize its value.”
> My experience in American organizations is that products and services need to not just make money, but make a lot of money.There is zero appetite for things that make a little bit of money relative to the cash cows of the company.
Is your experience in the same America where Meta is losing another 4-6 billion $ this year in AR/VR business unit, after losing 19 billion $ last year. Similar with Google's and Apple's AR/VR unit which also consume a lot of money in R&D(funding a lot of high paying jobs) and not make any money, yet.
So sure, there's no risk appetite for things that make little money, except for all the evidence proving the contrary.
There is zero appetite for things that make a little bit of money, but in big tech there is limitless appetite for things that lose money but might make a lot of money one day.
If it ends up AI only makes a little profit annually in the longer term the whole thing collapses on itself.
>There is zero appetite for things that make a little bit of money
Because "making little money" is a commodity business activity, overrun with competition from Europe and Asia.
So why would you ever want to compete in the race to the bottom of "little money" when you have the highest labor cost in the world? It makes no business sense.
You go into "all or nothing" moonshots because Europe and Asia can't compete there. Especially when you have the world reserve currency as the infinite money glitch cheat code (while it lasts).
> So why are Japanese companies like this? Why do they do so many different things? And how do they manage to do so all those different things so well?
Author says: Japanese companies excel in lots of very different domains because it’s inherent in how they’re structured.
My response: No mention of culture? Sure maybe it is because of how they are structured somewhat, but it's also because of their culture. Japanese are masters of their craft. Look at the best pizza place in the world, the best burger maker in the world.. they are not in Italy or America, but in Tokyo.
Japanese take pride in their work and master their craft. A small pizza-shop owner in Tokyo doesn't make great pizza because of how it was structured. It's cultural. Japan takes Western concepts, and applies an obsessive cultural devotion to mastery (Shokunin).
Look at all the foreign-things Japan is now famous for:
Japanese Whiskey, Denim, bread making, Japanese curry, etc.
I’ve always had the flip position of this. It’s that the ultra smart Japanese guy doesn’t have that much economic mobility. So he practises excellence in his field. Patio11 pointed out The Sort on his Twitter feed and after that I’ve been convinced of this.
EDIT: I forgot about this other thing. He also does describe a mechanism for that culture.
> Japan takes Western concepts, and applies an obsessive cultural devotion to mastery (Shokunin).
Thank you for explaining this. I was alawys amazed how the japanese would take the cuisine from other countries and make it better in all aspects than the country that originated it.
Why are people saying that the Japanese counterpart of other cuisines are better? Have you guys eaten the originals?
OP mentions curry, bread, pizza, etc. Those are things most gaijins complain about when in Japan!
Can't find a proper piece of bread that isn't sweetened, or you find a French chain doing something almost similar but still not on par with breads found in France.
I helped at a pizza shop near Fuji city and while it was not bad, they weren't quite there yet.
I can say that some foods are not bad but saying that they do things inherently better? C'mon now.
Still haven't found a decent thai or indian restaurant in Japan, and probably never will, given the general aversion for strong spices.
> Can't find a proper piece of bread that isn't sweetened, or you find a French chain doing something almost similar but still not on par with breads found in France.
Funny you mentioned France. Japan won the world pastry competition held in France. The french came second.
> Still haven't found a decent thai or indian restaurant in Japan, and probably never will, given the general aversion for strong spices.
are you not in Tokyo? Because “no decent Thai restaurant in Tokyo” is a wild claim
You can get spicy food in Tokyo! It’s just not going to be all the restaurants. You gotta to to the right place. But you don’t need 100 good thai restaurants to eat dinner, you just need the one.
I am a Spanish guy living in Japan, and while Japanese food is good and I surely enjoy it, their "Spanish restaurants" are a pale imitation of the original. Same for the Italian restaurants (which only cook spaghetti, as if there was no other kind of pasta), and I guess any other imported cuisine.
Look at the best pizza place in the world, the best burger maker in the world.. they are not in Italy or America, but in Tokyo.
That's a bold claim. While I'm sure the average quality in Japan is significantly better than ours, I would put the best pizza places in Jersey, NYC, and CT up against anywhere in the world.
It’s all kinda silly because there’s a “quantity is quality” thing going on with pizza and a lot of “commoner food”.
But Tokyo has a loooooooot of good food from various places, and a lot of people with money willing to spend 5 bucks a slice (for example). Or at least enough to sustain one restaurant.
The contrapositive: what magical thing exists in Jersey that would not be exportable to Tokyo?
I would bet that NYC has the best cheap slice tho.
Napoli: simplest possible ingredients, locally grown, from that amazing volcanic soil, for dirt cheap prices. It’s all about the Marinara and the Margherita.
In America it’s generally lots of ingredients piled on, with prices spiraling out of control.
Anecdote: on a recent trip to Nee York City I was momentarily excited to read about a place making Napoli style pizzas. Then I saw a pie was close to $40. In Napoli that was about €6.
However, when I only had a few minutes before a show I dove into the closest pizza place and got a giant NYC style slice for a little over $5. It was the best meal I had during that trip.
So I think the moral of the story is that the best pizza is the one from the shop closest to you done in the style that city is known for. At least if you’re in NYC or Napoli.
As a new yorker who loves pizza and could talk about it for hours, the median pizza place in naples is way better than the median pizza place in new york. :P
"Look at all the foreign-things Japan is now famous for: Japanese Whiskey, Denim, bread making, Japanese curry, etc."
I think all your examples are terrible (bread) or overpriced (Japanese Whiskey). There are also a lot of places that are pretty crap in Japan like restaurants where they clearly don't really care.
Compare to Italy that wherever you go everything seems really high quality. I was in a gas station in the middle of nowhere and I had a really great cappuccino for example.
Article argues that we don't see J-model software companies (or at least they aren't very good) because there's something inherent about software that demands innovation, green field work, blue sky ideas, etc., and that those things only happen (well) in an H-model company.
I disagree. So much of software is long lived or should be. We desperately need incremental refinement of already solid products and instead we have decay and rot because H-modelers make bad calls. (E.g. OSes.)
My team develops a product that is 15+ years old. As I read how J-models work, I kept thinking, "Yeah, we need that. That would help a lot. I'd love to work for decades on this product if we could do it thay way." Our product is mature and always in demand. But it always needs maintenance and it frequently needs significant improvement to keep pace with the changing environment around it. Bad H-model judgments have sent it in the wrong direction sometimes based on directives from on high, when, actually, the team itself holds so much knowledge and expertise that we can often self-organize in ways that maintain, refine, and improve this 15 year old system. We could benefit so much from a move toward proper J-model thinking.
> American firms, for example, tend to prioritize focus above all else: it would be bizarre for an American paper mill to also operate a concert hall and an airport catering business
I don't think Kimberly-Clark ever opetated a concert hall, but they did run an airline (Midwest Express) and K-C Aviation was an airplane servicing firm.
It's not that American companies don't operate in diverse businesses. Maybe they're less likely to, but it happens when the need arises... if there's no reasonable supplier for an important input, then you start one, or you ask an existing supplier if they can start a new line of business that's somewhat related.
The headline example is that Toto, known as a maker of ceramic toliets, is making a lot of money making specialty ceramics used in semiconductor manufacturing. Which yeah, ceramic manufacturer makes ceramics.
The US business market does like to spin-off divisions when they are successful and can be independent.
Yeah, we actually had our own era of “conglomerates” - they were very big from the 1960s through 1980s. Companies like ITT, Cendant, Gulf+Western, GE — formed from tons of acquisitions, sprawling across completely unrelated industries.
At one point in the 1990s, you could buy a toaster from the same company that makes airplane engines, MRI machines, and produces “Saturday Night Live.” And you may have financed that toaster through their financial arm (GE Capital). Eventually the many lines of business were spun off from companies like this.
What came next was a very different type of consolidation - companies like Comcast, Chevron, and the current “AT&T” who went from being regional players to buying as many other companies just like themselves in order to maximize economies of scale - they’re huge but really just do one or two very closely-related things.
I am not an expert, but my impression is that the era of US conglomerates was more a product of the financial superstructure: Post-WW2, demographic, economic, and technological growth created many large opportunities for business ventures. But capital markets were much less sophisticated, much smaller than today.
Existing large businesses were the primary source of major investments in new businesses, or in remaking old businesses for a rapidly modernizing world.
A great example is the bowling lane people AMF, who have over the years made things like pinsetters, jet-skis, motorcycles, scuba gear, shovels, and nuclear reactors. All spun in and out of the company over its life
A hypothesis I had on why some countries have more conglomerates than US is that access to capital and funds are much harder in those countries in comparison to US. When access to capital is comparatively more limited, more innovations falls to the party that has comparatively easier access to capital (conglomerates) and therefore reinforcing their position as conglomerate.
> the J-firm, run by its employees and largely indifferent to the interests of shareholders, exists simply to continue existing
I don't know if all companies should be run like Japanese companies, but there's something very heartwarming about this. Some companies exist for the purpose of employment, and that's okay. In fact it's admirable and makes me want to cheer.
I do also think there's a charm to this model but there's a real cost also with Japan's economy stagnating compared to the United States in the last 30 years.
There’s also a real cost to the system in the United States as well. As companies pivot people get left behind. And we’re potentially going to see with LLMs a large collapse in employment that corporations don’t even being to consider their responsibility. I’m not suggesting one is superior but they do both have their downsides.
That is because of population aging. Despite the US importing effectively endless amounts of young people, per capita income growth for working age population since the 1990s has been identical between US and Japan. I am unable to say why exactly but it should be obvious.
It is important to note, however, that the starting point is very different. The idea of employees robbing those evil shareholders sounds good but has resulted in capital markets that effectively do not function. Tidying up that mess will not be simple and improving equity markets will go a long way.
Also, the structure of Japan is a function of US policy after WW2 to dismantle the zaibatsu. In every single other historical case that I am aware of the result of "employee-friendly" policies has resulted in the kind of permanent underclass that people fear, incorrectly, that AI will lead to (i.e. Germany). It is a known bad idea. Japan avoided this because all the wealthy people's assets were taken, this didn't happen in other countries (i.e. Germany) which led to significant financial instability/risk/inequality (Germany also has inequality within a completely stagnant economic system, which is different from inequality in a system where the composition of wealthy people is continually changing...Germany's billionaires are a combination of people who mysteriously got rich in the 1930s very quickly and people who have been rich since the 10th century).
Japan is interesting but it is a complete outlier. Even with their relatively good relative economic performance, they could be producing absolute-terms growth that is double or even quadruple where it is now. Comparing middling economies like Japan or Western Europe with countries growing the same rate and per-capita incomes that are double is a misunderstanding of potential. Average economic performance should be double the US consistently for multiple decades.
Japan is getting poorer. People online love to talk about American stagnant wages, but Americans are considerably richer than they were 20 years ago. The median American earns 20% more in real terms, and even the bottom quintile of earners in America has increased their inflation adjusted earnings by 15%. In the same time period, the median Japanese inflation adjusted earnings is down 2.8%.
Compared to 20 years ago, Japanese people travel much less (millions fewer can afford to go overseas). Residential energy is 35% more expensive per kwh, compared to only 5% in the US. Food as a portion of monthly Japanese spend is 48% more expensive than it was 20 years ago. Despite millions of vacant dwellings, the home ownership rate is slipping. They earn less and they spend less.
Tokyo may seem quaint to American visitors clanking down their metal Chase travel credit card for more sushi, but for the typical Japanese, although they take it with grace and in stride, they have mired in stagnation and degrowth for a generation.
Frankly I think any QoL measure between a western and a Japanese life are meaningless.
If you’ve ever worked for a Japanese corp under a Japanese boss, you would basically experience that your life is hell. As a westerner we are even subjected to far lesser rules and customs than a Japanese, and yet to me it still felt far more stifling and unbearable than any western company I worked for. Western companies have different failure modes, but intense unspoken micromanagement and stupid expectations was never one of them.
And I was a supposed “subject matter expert”, to be treated better than rank and file. That said, this clearly works for Japanese people, many of them are happy, I think they would be miserable under a western firms “do whatever the f you want as long as you get results” culture. To each their own.
Japan in some sense is stagnating if you compare it to a GOAT like US, but Japan of 1910s was also probably stagnating compared to US, in its own terms Japan is doing fine and their political situation is much more civil. So GG to them
They work crazy long hours (the last of which every day don't do much at all for productivity), which is really bad for QoL. Though I hear that the situation is improving.
Most of Japan stagnation was the result of brutal pressure from the US in the 1980s that led to a series of fiscal and monetary choices that removed a lot of Japan's competitivity.
The median age of Japan went from 37 in 1990 to 50 in 2026. That's an insurmountable headwind. Soon, half the country will be elderly. That's no way to run a vibrant dynamic economy.
Some of the examples given in the article make more business sense than others. For example, mass manufacturers of ceramic home articles probably have science and technology expertise that cuts across product categories and markets. Sometimes the logic of focus hasn't focused enough on the expertise it takes to sustain, for example, both toilets and semiconductor manufacturing tooling. The spreadsheet might say you are unlocking shareholder value by spinning off one or the other business, but when it comes time to make the next generation products, it would be to your advantage to have knowledge of both products in house.
I like to create little businesses. Most of them are unsuccessful.
I tried to get a bit of business liability insurance, including E&O for this, but it’s proven to be somewhat difficult:
I do too many things.
I design and sell 3D printed plastic parts, write books, publish a blog, and publish software.
I’ve tried this like three times (it’s time consuming).
Last time I decided to stick with just digital assets and I put “software development” but listed my blog and books, figuring most software companies run forums, publish guides, and blog.
They declined because they don’t cover “publishers”.
I guess you need to buy insurance for each division or something.
I was just looking for some general business liability and E&O while I figure out what works.
I wrote How to Lose Money with 25-Years of Failed Businesses about some of my tries over the years.
I'm not sure I'd say a company that makes ceramic toilets also making a tool for memory chips... which is also ceramic is really 'different things'. They're clearly a ceramic company. Different tolerances, but similar expertise.
Now the paper company got into the hotel business seems a far better example. No idea how that happens.
> Now the paper company got into the hotel business seems a far better example. No idea how that happens.
That's easy. They have corporate visitors to their corporate offices and the available hotels are insufficient. They decide to just make their own hotel.
There are many corporate campuses with an embedded hotel. Some run by the corporation itself, some with significant management contracting with the corporation, and some independently managed.
Large corporation has a small travel business is very common.
I'd bet the leaders of the Japanese ceramic company have some deep ties and focus on ceramics, while the leaders of the US paper company have deep ties and focus on the financial industry.
U.S. energy-producing cooperatives are consumer-owned, not-for-profit utilities providing power to over 42 million Americans across 56% of the nation's landmass. These entities consist of local distribution systems, generation and transmission (G&T) cooperatives, and agriculture-focused energy co-op.
I wonder what it unique about electricity that this model is widely adopted in a predominantly anti-worker country in the world. Is it because farmers are the biggest votebank? And mostly rich, powerful, have all the political connections?
I almost forgot to mention Mumbai Dabbawala Association delivering food with clockwork precision since 1890, long before any of these web[1.0,2.0,3.0] 'tech' existed.
Mumbai Dabbawala Association is a 125-year-old, cooperative-style logistics system that delivers approximately 200,000 home-cooked meals daily to office workers across the city.
Asian countries seem to have a different approach to diversification. In the East it is the companies that diversify while in the West it is the shareholders that diversify. So Bill Gates will not tell Microsoft to start farming, but he probably does have farms in his portfolio.
I want to highlight that maybe today, big conglomerates are rare, but this is also because during the late-20th century, the trend was to break up conglomerates to increase competitiveness and improve financial performance of companies by focusing on the best businesses. If you look at the situation before that moment, Japan's situation would still be on the extreme side when compared to the other developed nations at the time, but not as unique I think.
In retrospect, I tend to think that this take was naive. It probably increased financial performance but it discouraged taking risks, and pushed the multidisciplinary skills out of companies in a way that is hard to reverse, inducing knowhow loss and probably slowed down innovation. But this is only my personal analysis and I am no economist.
> The first thing we should note is that Japanese companies do a lot of things differently from Western companies.
> The most important of these, by far, is lifetime employment
That ship has sailed. The most favorable accounts[0] put it around 30~40% of the workforce at most, other accounts pronounce it dead. There can be pockets of exceptions, but the bigger companies still afloat aren't shielded from that reality.
The Japanese economy is also famous for a macro economic stagnation for almost 40 years, a mild deflationary spiral, and companies hoarding cash on balance sheets rather than return it or invest it.
There are definitely world class companies in Japan, but also broad systemic problems with incentives
> In 2007, workers at a Toyota plant in Kentucky pulled the andon cord 2,000 times per week; workers at a Ford plant in Michigan pulled it just twice a week. You can’t get all the benefits of a single practice without installing the complete bundle.
This example seems to contradict the author's main point.
The Toyota factory in Kentucky got some of the benefits of the Japanese approach without importing every practice. They might have had a more Japanese organisation than Ford, but surely they didn't replace American practices in matters outside their control. They still had to deal with American approaches to labour practices, banking, local government, etc., all of which are called out in the article as necessary for the J-mode to flourish.
The article doesn't address branding very much, but one of the theories for why laser-focused American brands (like Starbucks, KFC, or McDonald's) do so well in Japan is that Japanese mega-companies are too brand-diluted to compete with them.
It's really odd to me that having an advanced ceramics division at Toto is considered such and odd diversified activity, and on top of that making money from the expertise of that division. Deep knowledge of ceramics would seem to me, to be a fundamental advantage if your main line of business is making ceramic toilets.
Companies like this with deep interlocking expertise used to be common in the US too when the US actually made things. GE was a conglomerate of "diversified" expertise - at least until a grandfather of financialization laid the seed to take apart the company.
AT&T and Xerox used to maintain all sorts of deep expertise in all sorts of science and technical activities - though maybe it could be noted that they were famously bad at spinning out other diversified product lines. But the expertise was a need in their core activities. Maybe the most interesting thing about Japanese businesses is that they have shown how to successfully start and maintain diversified product lines.
The main reason we are surprised by these "diversified" products, I suspect is that the typical American (and HN reader), is just not very familiar with the wide range of expertise needed to actually run manufacturing businesses.
What is odd is that a very small side business somehow unrelated to the main activity that is manufacturing toilets, suddenly become the activity providing the main income of the company.
That's a good question, but to me it is not not odd at all to see continuity of growth in that all hugely profitable lines start smaller and grow. The proposition of the VC startup industry is the same at the core of it. Do many small things that can become big, only this is a more organic expertise driven decision basis for building the expertise instead of hype cycles and FOMO
Look at it this way, you need to maintain the expertise anyway, originally for the Toilets, but you only need that expertise sometimes, and to be experts worth anything at all, they need to do things outside of what the company is already doing to deepen and maintain that expertise. If you have a set of highly technical experts operating like mini startups - is it a surprise that one might become a unicorn in the balance sheets from time to time?
I like to create little business try’s. Most of them are wildly unsuccessful. I tried to get a bit of business liability insurance, including E&O for this.
Why?
Because I do too many things.
I design and sell 3D printed plastic parts, write books, publish a blog, and publish software.
I’ve tried this like three times (it’s time consuming).
Last time I decided to stick with just digital assets and I put “software development” but listed my blog and books, figuring most software companies run forums, publish guides, and blog.
They declined because they don’t cover “publishers”.
I guess you need to buy insurance for each division or something.
I’d just like some general business liability and E&O while I figure out what works.
Basically having 2-3 guys with expertise working on a niche product preserves capability and you have a little turtleegg that can hatch into a product over time.
I almost feel like this topic deserves a further deep dive. This seems like a more profound difference of cultures: Japan, where failure is stigmatized and less of an option, optimizes for survival, and the United States, where failure is common, optimizes for growth(? wealth? fame?).
The pattern might also hold at a broader level. The United States is a relatively young nation that has seen plenty of internal strife (plenty of civil wars including The Civil War) whereas Japan has existed in some form for 2,600 years.
Probably too deep to consider, but the thought hit me that trees and plants (like these J-firms) grow multiple branches as quickly as they can because they are optimizing for survival.
There has been some internal stife in Japan, such as the Taira and Minamoto clans having a bit of a falling out, or that time when the Tokugawa somehow ended up on top, or tussles over the Meiji restoration. And also the "opening up undeveloped land" thing that was maybe not so benficial to the Ainu, and others.
How are you defining civil wars such that America has had "plenty" of them? Could you list a few?
If a corporation has an incentive to make money, it will align its priorities towards making money. Question is: are "making money" and "correct priorities" synonymous?
You use "zombie companies" as a universal pejorative and suggest we should all be instead worshiping at the alter of economic efficiency, JIT-delivery, and maximizing shareholder value without really considering the critiques there.
Yes, the "zombie company" strawman is paying people to move dirt from one hole to the other and back again which is dumb, but the "efficient company" has its own strawman, one drowning in manufactured debt, peeing in pee bottles in-between amazon warehouse isles, and unable to manufacture its own medical equipment when a black-swan pandemic event hits.
Which one is "better" largely depends on if you value societal stability or shareholder profits.
Or, in the framing of the article (which is summarizing Aoki, Milgrom, and Roberts), J-style companies exceed in periods of moderate volatility where 1) things don't change so much that you need the money-above-all-else incentive that favors strong hierarchical Jobs-like leadership that finds the visionary new solution, but 2) they change enough that the money-above-all-else incentive that favors value-engineering enshittification loses out to competition. The "societal stability" is just a part of the incentive bundle that forces the adaptation called the J-style approach.
The one key thing that is completely incorrect is there is no horizontal hierarchy. Everyone has a boss, a boss that you must not suggest is wrong. I'm very fond of visiting Japan but having worked there, found it impossibly challenging to get anything done.
When things work well it is great and the focused culture produces some great things, but when it fails it leads to catastrophe as no one is able to voice early in the process. Issues are only discovered once they are serious.
Also due to tax structures changing in ways the discouraged long term r&d for existing companies. Largely replaced with a university driven model today, or hyped based fake it till you make it startup investment
Concepts like this make me think about precision in products. When you spend 40,000$ on a computer chip you get a commodity piece of nm-scale precision. When you spend 40,000$ on a pink ivory coffee table you get a pile of wood with a maximum precision of 0.1-1mm. I'm just wondering what it would be like if atom-level precision was the main focus of every single premium product.
The 40,000$ of a bespoke coffee table comes from the uniqueness of the manufacturing process. No piece of wood is the same, and the way it is prepared from start to finish differs based on numerous factors.
The price of a computer chip has been lowered so significantly because of the standard process that is used across millions of chips with materials that are 99.999999999% pure.
Japanese conglomerates are relics of a handful of British businessmen's attempting to exploit and dominate Japan during the late colonial period. They did this outside the normal channels of conquest or statecraft, due to Japan's unique relationship to the world at the time.
I might be gatekeeping, but I consider a mark of actual healthy capitalism, to be creative destruction, the biggest companies of 1 generation are destroyed by the next generation and the churn keeps going on. Nothing ever lasts except the system.
By this criteria, in the entire world, only US and UK seem to do capitalism properly. Whether the current age of tech companies survive till 2050s is to be seen, (we are already seeing signs of OpenAI, Anthropic joining them but it is to be said if the existing monopolies of say Microsoft will be disrupted).
In other countries, big companies have been the same for hundreds of years, from Japan to Germany to Korea to India. This is no longer capitalism as much as it is some soft form of Feudalism, where the same set of families hold power for generations at a time till some major fortune swings occur.
This paragraph on organizational model is super relevant to understanding how tech companies are responding to LLMs today.
> Aoki’s key insight was that the J-mode had a comparative advantage in environments of moderate volatility: situations where conditions changed frequently enough that rigid central plans would be outdated before they were executed, but not so radically that only top-down strategic intervention could cope. In an environment of stable, predictable demand, the H-firm did fine; in an environment of extreme disruption, where the whole product line had to be rethought, centralized authority was indispensable, and the H-firm also did fine. But in between—where the challenge was to make constant small adjustments in a changing but recognizable paradigm—the J-firm excelled.
> Even a country like Germany, which matches Japan in its depth of high-precision firms, has nothing like Japan’s corporate diversification. Only a few large conglomerates, like Siemens, have anything approaching the lateral breadth of the Japanese firm.
Oh we had that level of conglomerates. Deutsche Bank and Allianz as capital providers, Siemens, AEG, Thyssen, Krupp, Mannesmann and a bunch of others formed the so-called "Deutschland AG" [1] - a web of interconnected very large companies, that also had very good ties to politics.
btw we have an american company that's doing a lot of different things: Amazon.
dumb example: it does computer chips (graviton cpus), it does backpacks and stationary (stuff under the "amazon basics" brand), it does editorial work (amazon self-publishing), it does satellite communications. oh and cloud computing and more and more stuff.
Very well done. I lived in Japan for years, love Japan deeply, and this essay rang true in many ways.
Two thoughts:
- Japanese management style and processes are probably fruitful ground for understanding how teams of agents should work. H-firms require inspirational leadership, and agents don't need that.
- There is an interesting opportunity to turn Japanese process knowledge into a trainable environment, which of course should be done in such a way to benefit Japan and the Japanese people ("The type of deep process knowledge that has accreted within companies like Kyocera and Toto is almost impossible to replicate")
> Hitachi makes nuclear reactors, power grids, railway systems, elevators, semiconductor manufacturing equipment, medical imaging devices, data storage, IT consulting, and industrial machinery.
They’re an absolute disaster but I do love that the companies are actually investing in expanding into new things. Shareholders don’t want that, they want cold hard cash. Hence all the buybacks and PE firms destroying companies.
Weird thinking that not spinning out every single thing into separate company/selling it out just to make the investor sheet look nice is considered "strange"
Vertical integration is almost looked like a mistake in the western investor driven companies; and inventions are to be bought, not actually made, why risk research money into anything not deemed "core business" by the market ?
Like with China, people try to explain Japan with "culture", which always results in a circular argument: China/Japan is this way, because that's what China/Japan is like.
An example would be "super apps". If you google this term you will see countless results that say "Chinese users prefer one app that does everything; they are also better at handling information density." The argument becomes: Super apps exist because Chinese users like Super apps. This is wrong. If you ever talk to a single Chinese user you will learn that none of them like these types of apps.
> "No it doesnt. As a Chinese, these apps are shitty to use and I struggle with finding what I need most of the time."
> 'Lol no.
> Its just bloat without careful thoughts.
> "We have this new product, pls add it to the main screen, pls send a notification to all our users to try it out, pls my promotion depend on it"
> You can get away with this for decades if the main moat is strong enough.'
> "I hate them, full of shitty ads and ads and ads. Basically, every app wants to lend you money, which is a total disaster."
There's not a single user that likes "super apps."
Then why do they exist? Because of the business environment. In the 2010s, post-iPhone and when smartphones became everyman's personal computing device, VC investment into China skyrocketed, culminating in 2015. Alibaba alone launched something like 50 new services during this decade. A few giant companies remained while the other startup tech companies failed; they divided the market among themselves, and in order to increase LTV per user they started bootstrapping their new services by putting links into them inside their existing platforms. Taobao adding links to Alipay and so on.
So "super apps" exist in China because of the business environment. The apps are literally designed by KPIs: get more users to click on this button and open this other service. It has so far been impossible for any startup to disrupt the BAT giants, so they can keep adding more and more services to the same apps and as a result they get more cluttered.
The reason I'm making the analogy about China is that the same is certainly true for Japan. It is a steady-state, non-dynamic market where companies that were created decades ago remain and can expand horizontally. It has nothing to do with Japanese culture.
This essay on Japan's corporate diversification and physical tacit knowledge is an interesting read. However, as an East Asian, my assessment is that this system is heavily driven by Japan's unique, subtle classism. It's a highly collectivist society with strict age-based milestones and immense pressure to secure traditional employment. In Japan, your corporate affiliation often dictates your social standing.
The author paints the lack of shareholder pressure as the secret behind their successful diversification. While true for a few, the flip side is that it created a massive 'zombie company' problem—a heavily discussed issue in Korea and Japan that the West seems largely blind to.
Also, the idea of a 'horizontal culture' in Japan is a myth, especially in software. Even a glance at the Japanese web(5ch, onJ etc...) reveals a deeply entrenched vertical hierarchy. In my experience working with Japanese developers, their reliance on the legacy Waterfall model and an exhausting chain of approvals and reporting was far from horizontal. (Though I admit my sample size is small, it heavily contradicts the Western narrative).
I agree that this rigid system fosters the tacit knowledge needed for hardware and materials. Still, it proves that we all tend to project our fantasies onto cultures we don't fully understand. The divergence in perspectives on HN never fails to amuse me.
Quite the opposite - for me, anyway.
FWIW, as a Westerner, I find the Mondragon Corporation to be fascinating and something I've read a lot about because there's no way we've figured out the ideal sort of setup for a business (or government, or any sort of human organization, given appropriate context) in the year 2026.
We have a lot to learn, and while "different" doesn't always mean "better," I strongly believe being exposed to "different" is necessary for us to devise novel approaches to human organization.
I still admire Mondragon and wish there were more companies like it, but now I try to remind myself that most characterizations from the outside are surely lacking in nuance.
In technical econ terms, the marginal profit of new employees is typically below the average profit of existing employees. A profit-maximizing business only cares that the marginal profit is positive, and will hire until there is no additional profit to be made. A co-op is incentivized to keep average profit per employee high, which can mean reducing headcount in order to keep the average strong. So that's why co-ops can have a sort of exclusive club feel to them.
SV is actually an interesting example which proves how employee ownership can drive prosperity, but the typical co-op crowd doesn't want to talk about it because it's too capitalist-coded. In a way, SV companies show that employee ownership is not some sort of instant cure for everything which ails capitalism.
In the US, the American Solidarity Party[3] draws from distributism, for instance.
[0] https://a.co/d/05BxSNZ9
[1] https://distributistreview.com/archive/an-introduction-to-di...
[2] https://www.youtube.com/watch?v=X1PtStipIsc
[3] https://www.solidarity-party.org/
He had to flee the country because his chosen party was purged. He survived a street battle. Then made a final visit to many of his comrades in prison.
Don’t presume that his views were shared with those who had influence.
He had admiration for his comrades in arms, especially the mess hall staff. He was on the workers side, but he was in the banned party, of the losing side of the war.
Above all, Orwell saw through the propaganda at home and the rest of the worlds deliberate misunderstanding of the whole situation. For instance, he saw that France had a tacit agreement with the Soviets to slow-walk supplying arms to the Nationalists, to ensure French financiers had protected investments in Spain’s railroads. And every newspaper outside Spain reported like Fox News.
Genuinely curious.
That said... It's hard to deny the romanticization and projection point above.
Beer goggles can be a mind expanding POV, but you need to be aware of it or you just end up being wrong for silly reasons.
A sober look at different is a good thing. Ooh... I agree that better and more advanced org concepts are likely still to be developed. But Otoh...
The article's thesis statement isn't "the Japanese approach is better," but that business practices like these bundle together, that they're very difficult to change, and that each bundle has different advantages and disadvantages.
Ironically, you've proved a deeper point about how amusing HN is: we all tend to project our fantasies onto the articles we're discussing, even if we didn't fully read or understand the article.
In reality, this system is largely sustained by the ruthless squeezing of subcontractors (for the record, I am Korean, but I actually like Japan), which is a massive social issue there. It’s very difficult for me to understand how anyone could view this structural dynamic as collaborative or horizontal.
If the author had concluded that their success in these niches stems from being an extremely vertical society where defying your superiors is simply not an option, I would have fully agreed. That aligns exactly with what I have experienced firsthand.
>"The andon method is really the J-mode in miniature. Information flows laterally, authority to act is widely distributed, and the people closest to the problems are the ones who fix it."
Does your definition of a 'horizotal culture' actually mean forcing people to work overtime just to hit deadlines? Are you sure you haven't completely confused 'horizotally' with 'top-down'
[1] https://www.jftc.go.jp/dk/guideline/unyoukijun/romuhitenka.h...
P.S. The link I provided is an official directive from the Japan Fair Trade Commission (JFTC) explicitly warning large corporations to stop ruthlessly suppressing their subcontractors' labor costs.
This country’s economy is built on the sacrifice of others.
Walmart and Amazon ruthlessly squeeze their suppliers. They achieve low prices on some things and try to corner the market on others (and then raise prices). What I don't see them achieving (to the contrary, I see them failing spectacularly at) is the quality control that some Japanese companies excel at.
So there has to be something more to it than that.
In the highly fluid U.S. corporate ecosystem, mobility is always an option. If a supplier loses a contract with Walmart, they can still pivot to another massive retailer, even if it's not quite as large.
Japan and Korea, however, have small landmasses, and the reputational risk is absolute. If a company's reputation is damaged by a single failure or a lost contract, their next job simply vanishes. Because of this existential threat, they fundamentally cannot compromise on quality. Imagine what happens to a small supplier in Japan if they are cut off by a mega-retailer like Aeon Mall. There is no backup giant waiting to take them. They are finished.
So, while geographical and structural differences dictate this extreme pursuit of quality, framing it as a "horizontal culture" is completely wrong. As an East Asian, I can confidently say that "horizontal culture" is the single most mismatched term you could possibly use to describe East Asia
Dogs and Demons: Tales from the Dark Side of Japan
japanese Business Culture and Practices: A Guide to Twenty-First Century Japanese Business Protocols
This is the picture painted for me by the article. Vertical integration eliminates subcontractors. Horizontal integration squeezes them.
> If the author had concluded that their success in these niches stems from being an extremely vertical society where defying your superiors is simply not an option, I would have fully agreed. That aligns exactly with what I have experienced firsthand.
Same story here. When switching jobs is made difficult, the incentive is not to make waves.
> Does your definition of a 'horizotal culture' actually mean forcing people to work overtime just to hit deadlines?
Yes, provided your boss is working with you.
The interesting question in all of these kinds of things is "are there ideas we can take to gain the strengths of other systems or patch the weaknesses in ours?". Looking at Japan specifically, I think I speak for most westerners in saying that if we could get a little more stability and less financial-quarter-driven behavior without taking the whole kit of lifetime employment and zombie companies, that would be a good thing. The author points out just how bundled that is, so it's a tough nut to crack.
One model that does give us that is the 'Untouchable visionary CEO' of Jobs and Musk, but I think the popularity of that approach is also limited, partially because of all the not so visionary CEOs trying to be Jobs, and partially because working for those guys is terrible. They inevitably seem to become tyrants.
Most Americans I know are familiar with the unending work culture of Japanese white collar workers (if only a parody version of it), and want no part of it.
Americans including myself love saying we’re busy though.
Not really sure they are measuring what they think they are measuring. This being more pronounced amongst young people may be because working long is being seen as less and less cool, as there has been a major vibe shift among young workers regarding their relationships with employers. Doesn't necessarily mean they are actually working less, might mean they don't want to admit it.
Revealed concrete hours would be much more trustworthy
HN has had posts romanticizing them, maybe check those
https://news.ycombinator.com/item?id=32622140
https://news.ycombinator.com/item?id=41438060
> it created a massive 'zombie company' problem—a heavily discussed issue in Korea and Japan that the West seems largely blind to
Zombie companies in the west are mentioned as a low/ZIRP phenomena. But the west shouldn't have as big an issue with those because companies, when less diversified, get killed off more often by interest rate hikes.
The EU’s crisis schemes like furloughing employees en masse dull the pain but also do prolong some companies’ lives. The US historically has had much more brutal impacts but quicker recoveries.
So we had overtime for 2 months working from 10am to 4am just so that we could deliver the "feature complete" software. If any bugs were found they were classified as either blockers (feature cannot be shown without) or scheduled to be fixed after delivery.
My boss knew it was stupid, he didn't like it but it was the standard contract from that big Japanese company and we were small and they weren't going to change that.
In Japan the corporation primarily provides stable income and employment for society, and secondarily returns on capital invested. In America, corporations primarily provide returns on capital invested and secondarily provide stable income and employment.
This shows up in the data too. Japanese corporations are less likely to go out of business but provide worse investment returns. American corporations provide better investment returns, but the citizens have to deal with layoffs.
Most citizens would prefer stability to growth, but I think the tradeoff has a lot of downstream consequences.
People want personal stability, which in our current society means a stable job.
That doesn't have to be the case, though.
Overall, economic growth is good for society as a whole, so it makes sense that a state should encourage it as much as it can.
This means that what is good for an individual is not the same as what is good for society.
I think the ideal solution would be to keep the risk-taking in business that you need for good growth, and instead provide stability through strong social support services, like healthy unemployment insurance or UBI. That way, everyone can take risks to try to drive the economy forward, but not starve if things go poorly.
The problem with basing the language in the aggregate, is implies that distribution doesn’t matter, and all modern economic models agree. This is a big problem for the reality of people living in ever increasing inequality. Money is a competitive resource, we use it to bid for real resources. If constant economic growth disproportionately goes to the already wealthy, it worsens inequality when resources to exploit become more scarce. It’s one thing to have massive swaths of untouched natural world to exploit for human benefits, but those days are long gone IMO.
(A worse issue is that inequality decreasing can mean things are getting worse for everyone.)
Economic growth means resources get more plentiful.
It took me a minute to figure out the typo ("depraved" instead of "deprived")
Japan compares much better to the US in terms of how much wealth the top 1% control. 24.6% vs 34.8% according to https://wid.world
Graph here: https://imgur.com/a/UwWvaHW
American CEOs are on the board of 8 companies but spend 5 minutes a year combined at the offices of those companies. They spend their weekends at private islands off the coast of the US Virgin Islands with other billionaires. They fire employees who ask for health care benefits or a day off. They actively endorse political candidates who went to the same private island with them and who will lengthen working hours, reduce benefits, and make it easier to fire employees. They want global surveillance to track anyone who's ever even considered saying anything bad about them. When it's possible to inject ads directly into our brains, those CEOs will force their employees to do it.
As an American who's been in Japan for a very long time and worked at Japanese companies, Japanese companies don't pay big bucks, but there are fewer deranged ultra rich people within them.
At the biggest ones you start to see branches of the organisation dedicated to c level services... Things like a driver awake and ready to go 24/7 (for the whole family), purchasing or even building apartments.
All available in the west, but the distinction is who directly pays for these things.
And in the long-term, people start fleeing the "stable" countries for already-grown ones.
Are you Japanese? Because this doesn't match what I know about Japanese companies, like Sony for example, who operate in a very American way.
Your image on Japanese vs American companies feels like the copy and pasted idealistic impression of what American redditors imagine Japanese companies would be like, rather than reality.
https://www.nber.org/papers/w1762
https://ideas.repec.org/p/iza/izadps/dp6183.html
Speaking for myself, I'd find that very interesting! I just stumbled over an article about it a few days ago, and don't think it's weird that different parts of the world would be interested in a regional business phenomenon.
I'd be pleasantly surprised, very impressed and it would make me reach out to have an offline chat. Not exaggerating.
Westerners are taught by the media and education to idealize Japan and hate China almost everywhere. They present cherry-picked aspects of both countries that make China look bad and Japan look good. In reality every country has its good and bad aspects.
This is just part of the propaganda machine and what politicians want you to believe, in an effort to align their populations to be supportive of their foreign policy and military motives. That ultimately trickles down to things like this. When people come to HN, or any place, with rose-colored glasses of Japan, they will seek confirmations of that rose color everywhere.
As an American educated by the American public education system and indoctrinated by American media, our government is certainly stupid and vengeful enough to make me want to support this if it were true, but it's just not. The much more banal truth is that Japan is extremely talented at exercising soft power by projecting a favorable image of itself via the media it exports, whereas China is just comparatively terrible at exercising this sort of soft power.
We're talking about media and narratives mainly.
On idealizing Japan, people here seem to think it's benefic and pushed by Japan, where I think it's more complicated. If the goal is to keep the US customers and workers in a state of fear and adversity, you need a credible threat from a somewhat powerful enemy, and idealization becomes needed.
That was Japan a few decades ago, that lead to the bashing movement, and I think it kept going t a smaller pace still, while China got set as the next unstoppable threat.
I think the default approach in the West - and that's not a US-specific thing - is to treat exotic faraway lands with a mix of curiosity and awe. But China is a geopolitical rival with a political system that rightly makes many Westerners queasy, so it doesn't benefit from that anymore.
No, everyday people are perfectly content to warm to brutal dictatorships who successfully put on a friendly face. Case in point: Dubai.
This is actually a great example for extant romanticization of China. People lauding Chinese expediency in the context of industry and construction often don't realize it's almost entirely enabled by extreme underregulation and underenforcement of industrial safety standards. Chinese people themselves will often point this out, though depending on the person they may frame it more in a style of "The West is slow because of all of the red tape!"
Of the subset of Westerners who are aware of this, sometimes I have to balk at how many of them will take that framing to heart and paint it as a positive thing. Even most Chinese don't have a positive view of it, not in reality. At most it's a tragic necessity required to build China up, though younger Chinese rightly tend to see it for what it is: corporate exploitation of laborers.
Of course in the context of solving political problems, the Politburo readily cutting through its own invented problems is another matter.
Thank fuck too. Neoliberalism sucks, along with EK + DT.
Turns out you need more that just vague platitudes than "things should be better."
No shit dude. Welcome to the ground floor everyone agrees with.
This is why EK is such a fucking dork. Go follow some organizers with your preferred beliefs, that would do you better than listening to the smart boy thinking very smart things and if you disagree with the smart boy you aren't a serious adult.
Kind of like Tesla's latest factories, or DR Horton building homes with massive problems from day 1?
Or Silicon Valley being a collection of superfund cleanup sites?
Or just the environmental pollution, in general, in Texas?
No one has figured out how to balance growth with safety. Ideally it shouldn't be hard, the total amount of money saved is pennies compared to the overall investment, but making everyone follow the rules via regulations ends to being a huge cost and time multiplier.
> but making everyone follow the rules via regulations ends to being a huge cost and time multiplier.
The cost and extra time it takes saves lives. That's the bottom line. It's your attitude that gets people maimed and killed.
My argument, and I should have made it clearer, is that we are paying a huge penalty for people who are dishonest. The amount of money they save by being dishonest and endangering others is generally tiny, but the cost to society to prevent the dishonesty is huge in the form of regulations.
You seem to be an American so I'm very confused. You'd have to be willingfully blind at this point to not see the anti-chinese propaganda that has been going on in America for (at least) the past decade.
It is true there is anti Chinese propaganda but that is neither here nor there since posturing in this way is simply what competing world powers do.
Look past the institutional framing. The citizenry of all countries on this world are in reality on the same side far more often than opposed. The average American worker, Chinese worker, Russian worker, all want the same things: stability, prosperity, a future worth living.
It is in the self interest of states to promote nationalism and construct out-groups.
But that does not mean ordinary people should internalize such division. A wise citizenry knows to separate the notion of geopolitical competition from hatred towards ordinary citizens/culture of other countries, no matter what the state apparatus tries to tell them.
Meanwhile, on platforms like YouTube and communities such as Hacker News, the bias is even much stronger. China, along with the broader “Axis of Resistance” and third worldist camp (though China arguably doesn’t fully belong there), is often praised, while the West, including Japan, receives disproportionate criticism.
Alternatively it could be due to emergent outcomes from our societies and systems.
Is there a word or concept that explains the idea that "people in power are controlling us"? Maybe the word is related to hierarchy? I also see it in conspiracy thinking (Rothschild, lizard people). The assumption that somebody is in charge manipulating us, and that we can discern their motives based on what their incentives are imagined to be.
A past example might be the red menace - which appeared to me to be part of US culture (politicians pushed it but I think they also took advantage of a natural us-versus-them zeitgeist). People seem to collectively desire a labeled enemy (you also see it about sports teams).
Or see the sibling comment "banal truth is that Japan is extremely talented at exercising soft power by projecting a favorable image of itself" where manipulation is imagined as the base cause. I just don't see the world that way (apart from the scientific difficultly of discerning cause versus effect in human systems).
Maybe it is just all memes.
Individually even very well educated people don't seem to see systems and effects of systems: e.g. every thread about economics e.g. politicians pretending they are in charge when systems have fucked them.
Now back in the 80s? Back in the 80s, despite being aligned with the West, they were perceived a lot like China is today. Everyone was scared that they were going to start eating the West's lunch and various negative stereotypes and exaggerations started to bubble up: it was a futuristic land, but a futuristic land of suicides, with little drone-like salarymen crammed into little shoebox apartments the size of a Western bathroom, working 20 hour days.
Between the Plaza Accords and the bubble bursting and decade after decade of Lost Decades, the Japanese threat was successfully neutralized. I think Cool Japan is mostly something they've earned for themselves, frankly.
Yep. A lot of cyberpunk fiction from that time that demonized corporate influence and power was inspired by the rise and perceptions of Japanese technology companies.
I can remember one of the American news magazine shows, maybe 20/20, showing a Japanese school with long hours and intense discipline and contrasting it with fat, illiterate American kids (the same stereotypes were made about the Soviet Union).
A lot of the perception of Japan, especially among Gen X and younger, is influenced from exports of Japanese culture. Nintendo, JRPGs, Manga, Anime, and even the quirky stuff reflects well on the Japanese though American eyes. No propaganda is needed.
You mean, American bathroom.
Apartments in major Europe cities aren't that much bigger than Japanese but for sure the bathroom sucks.
So basically just what the west is becoming?
Rather, the west seems to be characterized mostly by insanely expensive housing caused by an extreme antipathy towards denser housing as populations grow, and a K-shaped economy where white collar coastal elites are actually doing relatively well but everyone else - namely blue collar and service workers - are doing worse and worse. Suicide rates aren't rising dramatically, and are nowhere near where they were in Japan at their peak in the 80s, which itself was always overstated (they were higher than they were in the US at the time, but were comparable to many other western countries).
* better and better
https://www.nber.org/papers/w31010
(For the record, I would put Japan above both China and the US at the moment in that regard.)
this theory is typically mentioned when introducing the Theory of the Firm, i.e. why do companies exist at all? why not everyone just freelances, and when you need a marketing/finance/legal/coding person, you just contract one on the free market? the idea is that there are always frictions when doing business with someone new (is this person good? trust worthy? how do i find out?), and how much friction there is determines how big the firm will grow (to incorporate functions in-house, or expand to other industries).
in a perfect frictionless economy, it could indeed be true that business transactions all happen at the smallest unit, i.e. the individual. at the other extreme, there would just be one firm that coordinates all economic activities. all real world economies sit some where in between.
If HN was Brit-dominated, while less romanticised perhaps we probably would seem oddly fascinated with say France, to our minority members elsewhere.
There are people who romanticize Japan/Asia because they never were there and it is not attainable for them.
There are people who romanticize Japan/Asia because they have direct business interests to do so like selling dreams to the first group.
It's not at all like in the article, it's not horizontal, and very much hierchcal and rigid.
And it can be seen in japanese software, it looks like it was designed from request sheet without actually understanding why. It's often nonsensical and extremely convoluted.
Most of the good japanese software is actually developed in the west by subcontractors. For example Sony games
Western Japanophiles, especially from the US, and even if they speak the language and have lived there, are mostly ignorant and their idea of Japan is a full phantasy.
Lack of mobility across companies (no price discovery on wages), lack of specialization (no focus), age based hierarchy (anti-meritocratic). None of these sound good for a well-tuned system.
I suspect much of Japan's stagnation is due to this system.
IMO, the tight-knit division of labor between Toyota and its subcontractors is a slightly different story from the broad diversification within a single corporation. While the latter was historically bolstered by strong industry-academia ties (often driven by university cliques), we rarely see this kind of broad diversification happening in recent years. That said, Japan's traditional "membership-based" employment system, combined with a cultural reluctance to shut down unprofitable business units, is likely what has allowed this diversification to persist for so long.
In any case, Japanese companies are currently struggling with the friction between their traditional corporate culture and the superficial adoption of Western concepts like DX, Agile, meritocracy, job-based employment, and a startup-centric mindset. I suspect Korea might be facing similar structural clashes, though perhaps you are adapting at a much faster pace.
This particular article was decently nuanced though.
The Japanese company had some rituals were a bit weird, but harmless/charmingly quaint like mandatory volunteer days, keeping a copy of the founder's precepts on my desk for executive walkthroughs. They also had some bad tendencies, like praising employees for being there at 6AM/8PM. If something didn't work, they'd give it a bit of runway to see if it could pull through before cutting back. When there were layoffs, it was the whole division failing (each division competed with the others). It's hard to imagine what kind of political statements would have been offensive to that employer, it was just a neutral job. Really, the worst part was subpar compensation (and I still felt spoiled compared to Japanese coworkers).
My next job was at an American megacorp. The executives would give a holiday speech about "social responsibility" and how well we were doing, then layoff a factory. The employer was constantly involving themselves with US national politics, but employees were expected to refrain from having political opinions of their own.
Reminds me of my first job in state government where the incredibly underpaid workers had to go through bureaucratic paperwork if they needed a second job to pay the rent (ostensibly because of the conflict of interest risk)
Yet the governor was a known slumlord. I’m sure there’s no potential conflict of interest there.
During work hours or after work hours (for both)?
Car culture. We're a very car-centric society, and the Japanese auto makers have been a part everyday life to 3 full generations of Americans now. Even most Baby Boomers are too young to remember a world without Honda or Toyota. Across all age groups, a lot more Americans grew up with a fondness for their family's Toyota than their family's Hyundai.
I grew up in middle America. Both my grandfathers were "GM Men" if you will. Partly by vocation, partly by culture. On both sides of my family, every car was either a Chevy or a Buick. When my folks bought a Honda in 2007, it was treated like a scandal. But yknow what? Now one of my cousins has a Hyundai, and nobody batted an eye. Things are changing, even for the "raise hell praise Dale" crowd.
Japan's car makers, and their other industrials have a 40-year head start on embedding themselves in the American zeitgeist. Sony, Panasonic, Canon, Yamaha, they've all been here a really long time. They're loved because they're familiar. That's a bias, and I think that bias colors the way we talk about east Asian businesses more broadly.
I keep writing this over and over again on HN: There are NO highly developed non-micro states that are not car centric outside of major cities. Yes, literally, Japan, outside of a few large cities, is incredibly car centric. Sure, the cars are small and cute, but it is defintely car centric!
They came for a single reason: To avoid import tariffs. Please stop romanticising this for any other reason.Yeah and this is the exact reason why people call the US car-centric. Only in the US the large cities are car-centric too. You just proved the parent comment's point.
> They came for a single reason: To avoid import tariffs. Please stop romanticising this for any other reason.
You're hallucinating. There is zero romanticization in the parent comment about why they came to the US.
That's an argument. Lack of density means that public transportation is hard to have enough scale. But the US is uniquely bad at both density but also lack of transportation options. In countries like the UK and France (just because I'm familiar with them, I'm not claiming they're the only ones or it's something unique to them) even small towns have a regular bus or train connection to elsewhere. Might not be the best frequency, but it's there. In the US even multi hundred thousand people cities have literally nothing other than cars as an option.
So there are layers of car centricity. And considering most people live in cities, in countries like most of the developed world, the majority of the population has the option of at least decent transit. You know which countries are the exception.
I'd be interested in hearing an example or two of cities in the U.S. with populations greater than 200,000 that don't have a bus system.
https://arlingtonnetwork.com/arlington-mass-transit-rideshar...
Where did I suggest they came for any particular reason? I just said they got here first. They've had more time to become entrenched in people's lives than the Korean or Chinese companies that followed. That's all! Nothing "romantic" here!
At no point did I indicate any nostalgia for the idiosyncracies of the "GM patriarch" family. Is that what you're suggesting?
And yeah, "we" is Americans. As evidenced by the sentence that starts with "I grew up in middle America."
I genuinely don't understand this comment. It's like you saw "we're a car-centric society," stopped reading, and started typing.
Yamaha, Korg an Roland were the defining instrument producers of the 80s and 90s. Few things have altered the course of popular music as much as the TR-909 and TR-808, M1, DX-7, Juno, Jupiter. All of electronic music grew out of those.
The Walkman and Discman were iconic.
Honda was building P3 and ASIMO. The PlayStation 1/2 and Nintendo 64/GameCube were a thing.
I didn't even get into anime, the language or music from there until decades later. But all of the cool things came from Japan back then. Honestly, they still kind of do.
Although, to me, what I've always loved about Japan is how they will take every medium that arrives on the scene and treat it with loving craftsmanship. From jazz to skateboarding to yo-yos.
It resonates with me, because I get uncomfortable if I do too much passive consumption and am not making something.
Where does it not? As in which countries are not like this?
"Social standing" in this case means if your girlfriend's parents will let you marry her. Not, like, who likes your LinkedIn posts.
https://news.ycombinator.com/item?id=41438060
Oh, we're getting there. It's just a bit fringe right now, but Meta's $90 billion loss on VR and *gestures at various aspects of the Gamestop situation" and a few other incidents have people asking questions that are uncomfortable for the passive investmend fund crowd. Forget zombie companies; by many measures, America has a zombie economy.
It’s a huge structural flaw in the markets right now, yet it seems a flaw that isn’t really going to break anything which is weird in itself. I can’t help but feel that Wall Street is going to find the right place to kick at some point in order to have the whole house of cards come tumbling down for a while so they can buy cheap and negate/steal years of contributions from people buying index funds. Not sure how or when but I’m sure they’re working on it.
I can't shake the feeling of a grand fleecing incoming - and honestly, most big financial companies I know are against it because the blowback of inevitably bankrupting the firefighters&nurses pension fund will be congressional hearings and piercings of corporate veils.
Seems like the feds are pushing for it - for reasons I cannot fathom.
This is absolutely true in the US as well, by the way. People will treat you differently if you work for a FAANG company. People take a lot of pride in telling others they work for one. And we even have a word for someone who used to work for Google, for instance.
Related: In most of the world, carmakers separate out a luxury brand from their other products: Honda with Acura, Toyota with Lexus, etc. In Japan, they don't. The explanation I usually get is that the culture primarily associates luxury with "being attached to the big-name corporation". So you don't really improve on that by introducing another smaller brand, even one you build up as luxury.
See also the patio11 comment:
>>My salary was $30k, but there is some tangible value in having a pocket full of business cards which practically read "Attention, person who has just been handed this card: give the bearer whatever he wants. We're good for it. If you don't, we will remember." That status is very much not the same as the one you get if you combine two part-time jobs into the same level of income.
https://news.ycombinator.com/item?id=8576008
Are they successful?
Japanese culture reflects certain western attitudes which make it stand out.
Do I detect resentment?
I'd say so. Not on all the branches of the cooperative, but it generates over €11 billion in annual revenue and employs more than 70,000 people with a very stable business. It might be a bit tricky to gauge success when the rewards and incentives aren’t quite the same as in your typical capitalist company, though.
In his science fiction novels, Kim Stanley Robinson frequently incorporates the Mondragon economic model to explore post-capitalist, worker-owned, and cooperative societies. I'd say KSR is a decently well-known S/F writer, so at least some westerners (and I'd assume many in this site) have already some idea of it. But I'd say it's true that it's easy to romanticize these kinds of singular situations and brush over the problems they might have.
I know the author isn't trying to paint Japan as a utopia. The reason I call it 'romanticized' is because the author claims Japan's success in precision parts is driven by 'horizontal' and 'collaborative' practices. That just isn't true.
In reality, this system is largely sustained by the ruthless squeezing of subcontractors (for the record, I am Korean, but I actually like Japan), which is a massive social issue there. It’s very difficult for me to understand how anyone could view this structural dynamic as collaborative or horizontal.
If the author had concluded that their success in these niches stems from being an extremely vertical society where defying your superiors is simply not an option, I would have fully agreed. That aligns exactly with what I have experienced firsthand.
> In reality, this system is largely sustained by the ruthless squeezing of subcontractors (for the record, I am Korean, but I actually like Japan), which is a massive social issue there.
Well that's just like your opinion...man. I think you're both singularly wrong. Trying to attribute a single factor to a highly complex system is a fool's errand.
If your conclusion is correct "ruthless squeezing of subcontractors" are there other cultures whether there is true and the country has been successful in precision parts? Otherwise, it's pretty impossible to conclude the causality.
Have never heard about it until now, but just looking through it, sounds great!
Most HNers tend to be in their mid-30s to 50s so a lot of Japan-philia does appear to stem from an older mental image from the 1990s to 2010s.
> This essay on Japan's corporate diversification and physical tacit knowledge is an interesting read. However, as an East Asian, my assessment is that this system is heavily driven by Japan's unique, subtle classism. It's a highly collectivist society with strict age-based milestones and immense pressure to secure traditional employment. In Japan, your corporate affiliation often dictates your social standing...
The Japanese Keiretsu and later Trust Bank model is the norm in South Korea, Taiwan, China, and other Asian countries as well due to a mix of colonial, financial, and policymaking ties.
And people take pride in what they do, and try their best.
This seems quite presumptuous, and not all that different from the orientalism you're accusing OP of.
Orientalism in the standard definition means the Western tendency to view non-Western societies in an "othered" or exotic gaze, be it in either a pedestaling or derogatory context.
Think yellow fever, weebs, ad nauseum conversations about Japan (and Asia in general) on HN and Reddit.
2. While conglomerates remain prominent, a new generation of large Western-style employers like Rakuten, Mercari, LY, SoftBank, etc have arisen and operate with American-style (and -educated) management, and the stereotypical "salaryman" lifestyle is on it's last legs.
3. Japan has quietly become an immigration driven society. A major reason behind the rise of Takechi's faction in the LDP as well as Sanseito is because of the post-2019 immigration boom [1]. Going from less that 1% overseas born residents to around 4% in roughly 5 years was a massive shift socially and impacted both blue and white collar employment in Japan.
4. Japan has culturally shifted to be accepting of an offensive military posture. You see this shift in Japanese media (eg. SnK, Nippon Sangoku) as well as Japanese foreign policy [2]. A more muscular Japan with a chip on their back is arising.
5. Younger Japanese are more open to calling out tourists and Westerners when they do weird or weeb s#it or treat Japan as their own Disneyland. They now treat Westerners the same way they treat other non-Japanese people now. The mindset shift I've noticed is an "us" (which now includes Koreans and Taiwanese) versus "them" which now includes everyone else.
----
Ironically, I think contemporary South Korea is closer to the image that HNers have of Japan versus Japan today.
[0] - https://www.oecd.org/en/data/indicators/hours-worked.html
[1] - https://www.cw.com.tw/article/5136468
[2] - https://www.foreignaffairs.com/japan/return-japanese-hard-po...
I actually find the Western unawareness of how Japan has become an immigrant society, especially in service roles, to be hilarious. It's by far the biggest Japanese social change in the last 20 years probably up there with growing acceptance of LGBT lifestyles and is a massive, divisive political issue in Japan now. Also further goes to show how much idealized othering happens in these discussions.
The average konbini service worker a foreigner interacts with in Tokyo is going to be an immigrant. 12 years ago, I only met a handful of immigrant service workers.
A lot of that is operational as well - historically, the only other country with a large Japanese speaking population was South Korea, but salaries there have largely aligned and the post-1990s generation switched to concentrating on English instead of Japanese fluency. China has started to fill that gap though (hence why Chinese immigrants in Japan are viewed the same way as Indians are in Canada).
Basically, a company that whose entire internal documentation, communication, archive, and processes were always in Japanese will always bias in favor of hiring Japanese fluent employees, most of whom live in Japan and are Japanese.
You see the same thing in European countries as well, but the difference is it's easier for a German or French company to find talent somewhere else that is German or French fluent (eg. Turkiye/Poland or Morocco/Romania/ respectively).
The newer gen companies have a strong English muscle, but those are also the kinds of companies that are happy shifting hiring overwhelmingly to India or ASEAN.
Yet you see the same tropes peddled ad nauseum. I may as well use the same priors for Poland in 2026 as I would in the 2000s then when it was Europe's punching bag.
The reality is stuff changes.
I think HN'er are smart enough to not idealize everything about Japan.
For example you can be in awe about how clean and safe the country is and how precisely on time all subways train are without idealizing toilet that stream water up your arse.
So without idealizing the one Japanese thing that is inarguably good?
Replace 'Westerners' with Americans and you are spot on.
I have never met any European that glorifies any part of Japan (I'd see Asia as a whole), most of them will tell you how the tall buildings make them feel little and how the society is beyond oppressive.
Whatever meritocracy exists in capitalism is ironed out by those rigid hierarchies.
I am not sure what is appealing about Japan, Korea or any of these parts of the world, to me they are full of plastic, sugar and late stage capitalism that makes the Americans look as socialists.
I do strongly suspect that a certain type of male likes these places for reasons I cannot even hold in my mind for more than a few seconds.
Didn't France use to be quite Japano-phile? (At least for movies and anime/manga, but also cuisine). Or is this outdated knowledge now?
I will say that it often goes beyond "idealizing". I'd use the word "fetishizing".
I've wondered how much of this stems from being disaffected by the modern (particularly Western) world. I worked with an ethnically Chinese guy who was a massive weebu and that always struck me as odd given the Japan-China history.
Japan has always rubbed me the wrong way: misogyny, racism and denial about Japanese war crimes in WW2 mostly. Also the salaryman work culture. I see videos from Japanese workers and life honestly looks miserable. It's also a country that is dying. The samurais, ninjas, Ronin, shoguns, etc are cool though. Japanese history is fascinating.
My hot take here is that China is actually what people idealize Japan to be. China has the most competent government in the world and it's not even close. It's not problem-free. Nowhere is. But the transformation in the lives of ordinary Chinese people over the last few decades is unbelievable. China pulled ~800 million people out of extreme poverty.
It could be worse than Japan too. I think South Korea is that. As a non-Korean from the outside looking in, South Korea looks like a dystopian run by aristocratic (chaebol) families where the birth rate is the lowest in the world and it's in fact so low that if nothing changes, South Korea simply won't exist in 3 generations.
2. Post WWII Japan set the benchmark for pulling its people out of poverty in an astonishingly short period of time.
3. There have always been foreign, exotic cultures people have romanticized. The Romans romanticized Greece and ancient Egypt.
By abandoning the policies that put them in poverty.
The story of China in the 20th century is largely one of missing the bus of the progress that was happening around them. The mechanization of Japan enabled the atrocities you mentioned because China refused to see the writing on the wall (from a balance of power perspective, Japan doesn't get a pass for what they did). Then, when they finally do have a revolution, they end up joining up with the group that weilds absolute power and causes catastrophic famine.
In the 21st century, they've slowly begun adopting western policies and are reaping the benefits while eroding their previously disasterous national policies.
The CCP has become more prosperous as it's become more like Hong Kong.
I've never been to South Korea. I'd like to go to Seoul. For me though, South Korea is a cautionary tale in what happens to a country when a handful of families get to control all the wealth, all the good jobs, all the good university places and so on while the working class gets squeezed ever more. There are cultural issues here too that are distinctly Korean, namely that women are expected to have a demanding job AND have children, look after those children and take care of the house (traditionally).
[1]: https://www.youtube.com/watch?v=-Im4YAMWK74
Young people in general aren't stupid (again, in general, not just China). They can look around and see they have limited opportunities, will probably never own a home, won't ever be able to retire, will have crippling debt (for college in the US), etc so it's natural to look around and say "what exactly is the point?" and, in some cases, just opt out. In the US you see this with things like "van life", moving to cheaper countries, tiny homes or just spending all your money on experiences because, to you, you have no future. I thin kreligion historically played a huge role in getting people to do those things anyway. But now, why would Alfred Q. Zoomer live paycheck-to-paycheck doing a shitty job just so Jeff Bezos can have slightly more money?
China at least has invested in eliminating poverty, building infrastructure (eg the high speed rail network) and transforming the lives of everyday Chinese people. Like I see Tiktoks from a rural Chinese woman who works in a shoe factory for $11/day but only really spends $1/day to live. She lives in a modern house (20+ years ago it was a rundown shack), has Internet, watches live streams, rides everywhere on an electric scooter and pays for everything digitally (of course).
Part of China's current woes are that Xi Jinping quietly just popped the real estate bubble and declared that houses are for living, not speculation. That market has been correcting itself for years ever since. But that's a long-term good.
I'll take the transformation of Chinese lives (not just in Tier 1 cities) over what's happened in coal mining country, the Rust Belt and agricultural communities in the US. It's not even close.
I suspect your information might be out-of-date because I've seen videos of tourists in Tier 3/4 cities (let alone Tier 2) and honestly it beats most US cities. There's no official list of tier cities but Chongqing is widely considered a Tier 2 city. Chongqing is widely called the "cyberpunk city" [4].
[1]: https://www.reuters.com/sustainability/society-equity/china-...
[2]: https://thediplomat.com/2026/05/why-china-treats-lying-flat-...
[3]: https://www.reuters.com/world/asia-pacific/chinas-youth-jobl...
[4]: https://www.youtube.com/watch?v=DYpbUCn2lus
> you have a firm that has lots of lifetime employees who can’t be fired, and whose skills are tailored to what your firm needs rather than to a particular occupational category transferable to any employer
> the system only makes sense if the company is also insulated from outside pressure
> the J-firm [Japan-style company], run by its employees and largely indifferent to the interests of shareholders, exists simply to continue existing
> And that basic impulse toward survival is why Japanese companies are so insistent on diversification. If you’ve made a commitment to keep people employed for life, then you need to create jobs for them if their current jobs stop making sense
> If you’re not very worried about profitability, and have lots of well-trained generalist employees, then it makes perfect sense to reinvest your company’s earnings by expanding into new industries
Checkout this article that talks about it: https://www.theatlantic.com/business/2010/07/5-lessons-of-ja...
edit: added article.
One interesting thing about US is that money is worshipped, sure, the super rich billionaires live differently, they can have massive mansions with domestic staff, drivers, live life large, but they are completely outside of society. For people in the 0 - 100m+ range who are forced to interact with each other, there is no big high-status attached to the rich, their lives are a little bit better, but people aren't talking/treating them special. Compare this to a third world country like India, everything is a status marker, if you have a car you are treated a lot better than someone without a car. The outward displays are wealth/status are critical for day-to-day interactions.
After that ‘national security issue’ becomes a running joke. A bit like calling everyone a terrorist, or (very fashionable in the 1960s) communist to achieve your goals.
Hard to overpay the CEO when you're facing actual competition.
You can shaft TSMC works pretty well because where they going to go? Intels fab?
That's kinda a story behind China's start into fabs is "poaching" TSMC workers.
My argument is more of a rising ships than a falling CEO; overpay being relative.
That makes about as much sense as comparing top 500 Hollywood actor earnings (including residuals) with the day wages of the folks showing up in TV commercials and as film extras.
The BLS keeps statistics on Chief Executives in general, and pegs their median wages around $200k:
https://www.bls.gov/oes/2023/may/oes111011.htm
So yes, it is a problem when leadership doesn't have long term aspirations for the large company.
How is it working for the US to have every company mostly owned by the general public's retirement funds?
It’s working quite well for retirees.
Sure, but ownership being the root of inequality was the one thing that he was actually correct about. CEO to worker pay ratio is something that is completely irrelevant. Companies spend orders of magnitude more money on its shareholders (dividends, buybacks, and reinvestment) than executive compensation.
10% annual returns over previous 30 year returns for a fully liquid investment, 15% annual returns over previous 10 years.
Glorious for the beneficiaries of the retirement funds.
> Here is the answer I want to suggest: Japanese companies excel in lots of very different domains because it’s inherent in how they’re structured.
Which is then backed by some economists saying something similar (generally), but all of which completely ignores Japan’s specific history.
As a better example Of examining Japan, here’s a look at Japan’s monopolies, how they were broken up, and partly how that effected the future of their industry:
https://m.youtube.com/watch?v=5_-Ac68FKG4
It hasn't always been like that. Western companies, including US companies, used to have lots of diversification as well (maybe not as much as the Japanese, but much more than today's companies still: not that long ago a company like IBM used to make mouses and keyboards, in addition to their photocopier, mainframe, software, and personal computer business. They even made a hydrogen peroxide analyzer in 1982![1]). They did so because it makes the company more resilient, and because in that time their shareholders wanted the companies they invested in to be resilient, to have a reasonable yield/risk profile.
Things changed in the 80s, when deregulation generate a boom in financial products. Then, individual company resilience was seen as obsolete, you'd cover your risk through portfolio diversification and all you'd want from a company was the pure yield, and companies were streamlined to make as much profit as possible, everything reducing the ratio being sold or terminated.
Fast forward 40 years, people believe it has always been like that and it must be so kind of deep cultural difference between Asia and the West.
[1]: https://web.archive.org/web/20050119055353/http://www-03.ibm...
People can still get hired mid-career, of course, but many companies traditionally hire based more on long-term potential than immediately usable skills, since they expect to train employees heavily through OJT. That also means the number of openings for experienced hires can be relatively limited. And because of the seniority-based structure, even experienced workers may end up starting near the bottom anyway.
There was an entire generation of people who missed that initial hiring window because of economic downturns and hiring freezes, and many of them still struggle to land stable permanent positions even today.
Things are gradually changing, but many structural assumptions are still there. For example, parts of the legal and employment system are historically built around the assumption of lifetime employment, which also makes it difficult for companies to dismiss permanent employees once they are hired.
For obvious reasons, the expected rate of return needs to clear the hurdle of the risk-free interest rate. This puts a pretty high floor on activity that is "worth doing". This is a mechanism by which the phenomenon of ZIRP diversifies economic activity.
Small absolute changes in risk-free interest rates cause many things to become unprofitable when the relative change in interest rates is large. A risk-free rate of 1.0% and 1.5% are both small but the latter is 50% higher than the former.
The other side of this is only new baby firms invest in that thing that makes a little bit of money. But given enough refinement, that thing starts making more and more money as it gets better and better. And soon, that new baby firm outshines the incumbent. The incumbent's wasn't incentivized to invest in the thing that started off worse but eventually became the new model. Think Kodak with film-vs-digital cameras.
This was the thesis of 1997's The Innovator's Dilemma, written by the guy who coined "Disruptive Technology".
Is your experience in the same America where Meta is losing another 4-6 billion $ this year in AR/VR business unit, after losing 19 billion $ last year. Similar with Google's and Apple's AR/VR unit which also consume a lot of money in R&D(funding a lot of high paying jobs) and not make any money, yet.
So sure, there's no risk appetite for things that make little money, except for all the evidence proving the contrary.
If it ends up AI only makes a little profit annually in the longer term the whole thing collapses on itself.
Because "making little money" is a commodity business activity, overrun with competition from Europe and Asia.
So why would you ever want to compete in the race to the bottom of "little money" when you have the highest labor cost in the world? It makes no business sense.
You go into "all or nothing" moonshots because Europe and Asia can't compete there. Especially when you have the world reserve currency as the infinite money glitch cheat code (while it lasts).
Author says: Japanese companies excel in lots of very different domains because it’s inherent in how they’re structured.
My response: No mention of culture? Sure maybe it is because of how they are structured somewhat, but it's also because of their culture. Japanese are masters of their craft. Look at the best pizza place in the world, the best burger maker in the world.. they are not in Italy or America, but in Tokyo.
Japanese take pride in their work and master their craft. A small pizza-shop owner in Tokyo doesn't make great pizza because of how it was structured. It's cultural. Japan takes Western concepts, and applies an obsessive cultural devotion to mastery (Shokunin).
Look at all the foreign-things Japan is now famous for: Japanese Whiskey, Denim, bread making, Japanese curry, etc.
EDIT: I forgot about this other thing. He also does describe a mechanism for that culture.
Thank you for explaining this. I was alawys amazed how the japanese would take the cuisine from other countries and make it better in all aspects than the country that originated it.
OP mentions curry, bread, pizza, etc. Those are things most gaijins complain about when in Japan!
Can't find a proper piece of bread that isn't sweetened, or you find a French chain doing something almost similar but still not on par with breads found in France.
I helped at a pizza shop near Fuji city and while it was not bad, they weren't quite there yet.
I can say that some foods are not bad but saying that they do things inherently better? C'mon now.
Still haven't found a decent thai or indian restaurant in Japan, and probably never will, given the general aversion for strong spices.
Funny you mentioned France. Japan won the world pastry competition held in France. The french came second.
How about that?
I still think that you'd find better French bread at any average French town than in Japan, given my personal experience living there.
And sure maybe not upscale Tokyo but Japan is not just Tokyo.
are you not in Tokyo? Because “no decent Thai restaurant in Tokyo” is a wild claim
You can get spicy food in Tokyo! It’s just not going to be all the restaurants. You gotta to to the right place. But you don’t need 100 good thai restaurants to eat dinner, you just need the one.
You can get very hot spicy katsu curry in most Japanese cities.
I am a Spanish guy living in Japan, and while Japanese food is good and I surely enjoy it, their "Spanish restaurants" are a pale imitation of the original. Same for the Italian restaurants (which only cook spaghetti, as if there was no other kind of pasta), and I guess any other imported cuisine.
That's a bold claim. While I'm sure the average quality in Japan is significantly better than ours, I would put the best pizza places in Jersey, NYC, and CT up against anywhere in the world.
But Tokyo has a loooooooot of good food from various places, and a lot of people with money willing to spend 5 bucks a slice (for example). Or at least enough to sustain one restaurant.
The contrapositive: what magical thing exists in Jersey that would not be exportable to Tokyo?
I would bet that NYC has the best cheap slice tho.
I just don't think Italy _gets_ pizza the way America does.
In America it’s generally lots of ingredients piled on, with prices spiraling out of control.
Anecdote: on a recent trip to Nee York City I was momentarily excited to read about a place making Napoli style pizzas. Then I saw a pie was close to $40. In Napoli that was about €6.
However, when I only had a few minutes before a show I dove into the closest pizza place and got a giant NYC style slice for a little over $5. It was the best meal I had during that trip.
So I think the moral of the story is that the best pizza is the one from the shop closest to you done in the style that city is known for. At least if you’re in NYC or Napoli.
"Italy" as a whole, I make no claims on.
I think all your examples are terrible (bread) or overpriced (Japanese Whiskey). There are also a lot of places that are pretty crap in Japan like restaurants where they clearly don't really care.
Compare to Italy that wherever you go everything seems really high quality. I was in a gas station in the middle of nowhere and I had a really great cappuccino for example.
I disagree. So much of software is long lived or should be. We desperately need incremental refinement of already solid products and instead we have decay and rot because H-modelers make bad calls. (E.g. OSes.)
My team develops a product that is 15+ years old. As I read how J-models work, I kept thinking, "Yeah, we need that. That would help a lot. I'd love to work for decades on this product if we could do it thay way." Our product is mature and always in demand. But it always needs maintenance and it frequently needs significant improvement to keep pace with the changing environment around it. Bad H-model judgments have sent it in the wrong direction sometimes based on directives from on high, when, actually, the team itself holds so much knowledge and expertise that we can often self-organize in ways that maintain, refine, and improve this 15 year old system. We could benefit so much from a move toward proper J-model thinking.
I don't think Kimberly-Clark ever opetated a concert hall, but they did run an airline (Midwest Express) and K-C Aviation was an airplane servicing firm.
It's not that American companies don't operate in diverse businesses. Maybe they're less likely to, but it happens when the need arises... if there's no reasonable supplier for an important input, then you start one, or you ask an existing supplier if they can start a new line of business that's somewhat related.
The headline example is that Toto, known as a maker of ceramic toliets, is making a lot of money making specialty ceramics used in semiconductor manufacturing. Which yeah, ceramic manufacturer makes ceramics.
The US business market does like to spin-off divisions when they are successful and can be independent.
At one point in the 1990s, you could buy a toaster from the same company that makes airplane engines, MRI machines, and produces “Saturday Night Live.” And you may have financed that toaster through their financial arm (GE Capital). Eventually the many lines of business were spun off from companies like this.
What came next was a very different type of consolidation - companies like Comcast, Chevron, and the current “AT&T” who went from being regional players to buying as many other companies just like themselves in order to maximize economies of scale - they’re huge but really just do one or two very closely-related things.
Existing large businesses were the primary source of major investments in new businesses, or in remaking old businesses for a rapidly modernizing world.
https://en.wikipedia.org/wiki/ITT_Inc.
used to have a big position in hotels and just about everything else and it trained quality movement advocate Phil Crosby
https://en.wikipedia.org/wiki/Philip_B._Crosby
https://commoncog.com/how-to-become-an-asian-tycoon/
https://commoncog.com/the-asian-conglomerate-series/
I don't know if all companies should be run like Japanese companies, but there's something very heartwarming about this. Some companies exist for the purpose of employment, and that's okay. In fact it's admirable and makes me want to cheer.
It is important to note, however, that the starting point is very different. The idea of employees robbing those evil shareholders sounds good but has resulted in capital markets that effectively do not function. Tidying up that mess will not be simple and improving equity markets will go a long way.
Also, the structure of Japan is a function of US policy after WW2 to dismantle the zaibatsu. In every single other historical case that I am aware of the result of "employee-friendly" policies has resulted in the kind of permanent underclass that people fear, incorrectly, that AI will lead to (i.e. Germany). It is a known bad idea. Japan avoided this because all the wealthy people's assets were taken, this didn't happen in other countries (i.e. Germany) which led to significant financial instability/risk/inequality (Germany also has inequality within a completely stagnant economic system, which is different from inequality in a system where the composition of wealthy people is continually changing...Germany's billionaires are a combination of people who mysteriously got rich in the 1930s very quickly and people who have been rich since the 10th century).
Japan is interesting but it is a complete outlier. Even with their relatively good relative economic performance, they could be producing absolute-terms growth that is double or even quadruple where it is now. Comparing middling economies like Japan or Western Europe with countries growing the same rate and per-capita incomes that are double is a misunderstanding of potential. Average economic performance should be double the US consistently for multiple decades.
* Japan is ranked 23rd on the Human Development Index. The US is 17th.
* However, Japan is ranked 8th on the US News Quality of Life Index. The US is 30th.
Grass is greener on the other side.
https://data.worldhappiness.report/
https://en.wikipedia.org/wiki/List_of_countries_by_Human_Dev...
https://www.usnews.com/news/best-countries/best-countries-fo...
Compared to 20 years ago, Japanese people travel much less (millions fewer can afford to go overseas). Residential energy is 35% more expensive per kwh, compared to only 5% in the US. Food as a portion of monthly Japanese spend is 48% more expensive than it was 20 years ago. Despite millions of vacant dwellings, the home ownership rate is slipping. They earn less and they spend less.
Tokyo may seem quaint to American visitors clanking down their metal Chase travel credit card for more sushi, but for the typical Japanese, although they take it with grace and in stride, they have mired in stagnation and degrowth for a generation.
If you’ve ever worked for a Japanese corp under a Japanese boss, you would basically experience that your life is hell. As a westerner we are even subjected to far lesser rules and customs than a Japanese, and yet to me it still felt far more stifling and unbearable than any western company I worked for. Western companies have different failure modes, but intense unspoken micromanagement and stupid expectations was never one of them.
And I was a supposed “subject matter expert”, to be treated better than rank and file. That said, this clearly works for Japanese people, many of them are happy, I think they would be miserable under a western firms “do whatever the f you want as long as you get results” culture. To each their own.
Japan in some sense is stagnating if you compare it to a GOAT like US, but Japan of 1910s was also probably stagnating compared to US, in its own terms Japan is doing fine and their political situation is much more civil. So GG to them
I like to create little businesses. Most of them are unsuccessful.
I tried to get a bit of business liability insurance, including E&O for this, but it’s proven to be somewhat difficult:
I do too many things.
I design and sell 3D printed plastic parts, write books, publish a blog, and publish software.
I’ve tried this like three times (it’s time consuming).
Last time I decided to stick with just digital assets and I put “software development” but listed my blog and books, figuring most software companies run forums, publish guides, and blog.
They declined because they don’t cover “publishers”.
I guess you need to buy insurance for each division or something.
I was just looking for some general business liability and E&O while I figure out what works.
I wrote How to Lose Money with 25-Years of Failed Businesses about some of my tries over the years.
https://joeldare.com/how-to-lose-money-with-25-years-of-fail...
Reading it now, great read!
Now the paper company got into the hotel business seems a far better example. No idea how that happens.
That's easy. They have corporate visitors to their corporate offices and the available hotels are insufficient. They decide to just make their own hotel.
There are many corporate campuses with an embedded hotel. Some run by the corporation itself, some with significant management contracting with the corporation, and some independently managed.
Large corporation has a small travel business is very common.
Amul is controlled by 3.6 million milk producers: https://en.wikipedia.org/wiki/Amul
U.S. energy-producing cooperatives are consumer-owned, not-for-profit utilities providing power to over 42 million Americans across 56% of the nation's landmass. These entities consist of local distribution systems, generation and transmission (G&T) cooperatives, and agriculture-focused energy co-op.
The nation’s 900 electric cooperatives (co-ops) power the homes of more than 42 million Americans across 47 states: https://www.energy.gov/cmei/success-stories/articles/eere-su...
I wonder what it unique about electricity that this model is widely adopted in a predominantly anti-worker country in the world. Is it because farmers are the biggest votebank? And mostly rich, powerful, have all the political connections?
Mumbai Dabbawala Association is a 125-year-old, cooperative-style logistics system that delivers approximately 200,000 home-cooked meals daily to office workers across the city.
https://theonion.com/yamaha-ceo-pleased-with-current-product...
In retrospect, I tend to think that this take was naive. It probably increased financial performance but it discouraged taking risks, and pushed the multidisciplinary skills out of companies in a way that is hard to reverse, inducing knowhow loss and probably slowed down innovation. But this is only my personal analysis and I am no economist.
> The most important of these, by far, is lifetime employment
That ship has sailed. The most favorable accounts[0] put it around 30~40% of the workforce at most, other accounts pronounce it dead. There can be pockets of exceptions, but the bigger companies still afloat aren't shielded from that reality.
[0] https://eprints.whiterose.ac.uk/id/eprint/43581/1/matanlemat...
There are definitely world class companies in Japan, but also broad systemic problems with incentives
This example seems to contradict the author's main point.
The Toyota factory in Kentucky got some of the benefits of the Japanese approach without importing every practice. They might have had a more Japanese organisation than Ford, but surely they didn't replace American practices in matters outside their control. They still had to deal with American approaches to labour practices, banking, local government, etc., all of which are called out in the article as necessary for the J-mode to flourish.
Companies like this with deep interlocking expertise used to be common in the US too when the US actually made things. GE was a conglomerate of "diversified" expertise - at least until a grandfather of financialization laid the seed to take apart the company.
AT&T and Xerox used to maintain all sorts of deep expertise in all sorts of science and technical activities - though maybe it could be noted that they were famously bad at spinning out other diversified product lines. But the expertise was a need in their core activities. Maybe the most interesting thing about Japanese businesses is that they have shown how to successfully start and maintain diversified product lines.
The main reason we are surprised by these "diversified" products, I suspect is that the typical American (and HN reader), is just not very familiar with the wide range of expertise needed to actually run manufacturing businesses.
Look at it this way, you need to maintain the expertise anyway, originally for the Toilets, but you only need that expertise sometimes, and to be experts worth anything at all, they need to do things outside of what the company is already doing to deepen and maintain that expertise. If you have a set of highly technical experts operating like mini startups - is it a surprise that one might become a unicorn in the balance sheets from time to time?
I like to create little business try’s. Most of them are wildly unsuccessful. I tried to get a bit of business liability insurance, including E&O for this.
Why?
Because I do too many things.
I design and sell 3D printed plastic parts, write books, publish a blog, and publish software.
I’ve tried this like three times (it’s time consuming).
Last time I decided to stick with just digital assets and I put “software development” but listed my blog and books, figuring most software companies run forums, publish guides, and blog.
They declined because they don’t cover “publishers”.
I guess you need to buy insurance for each division or something.
I’d just like some general business liability and E&O while I figure out what works.
The pattern might also hold at a broader level. The United States is a relatively young nation that has seen plenty of internal strife (plenty of civil wars including The Civil War) whereas Japan has existed in some form for 2,600 years.
Probably too deep to consider, but the thought hit me that trees and plants (like these J-firms) grow multiple branches as quickly as they can because they are optimizing for survival.
How are you defining civil wars such that America has had "plenty" of them? Could you list a few?
For every neatly diversified company you have 10 zombie companies with workers floundering around like ants without a queen.
You use "zombie companies" as a universal pejorative and suggest we should all be instead worshiping at the alter of economic efficiency, JIT-delivery, and maximizing shareholder value without really considering the critiques there.
Yes, the "zombie company" strawman is paying people to move dirt from one hole to the other and back again which is dumb, but the "efficient company" has its own strawman, one drowning in manufactured debt, peeing in pee bottles in-between amazon warehouse isles, and unable to manufacture its own medical equipment when a black-swan pandemic event hits.
Which one is "better" largely depends on if you value societal stability or shareholder profits.
Or, in the framing of the article (which is summarizing Aoki, Milgrom, and Roberts), J-style companies exceed in periods of moderate volatility where 1) things don't change so much that you need the money-above-all-else incentive that favors strong hierarchical Jobs-like leadership that finds the visionary new solution, but 2) they change enough that the money-above-all-else incentive that favors value-engineering enshittification loses out to competition. The "societal stability" is just a part of the incentive bundle that forces the adaptation called the J-style approach.
In Japan's case, quite literally -- as their population distribution looks like its about to topple over.
The price of a computer chip has been lowered so significantly because of the standard process that is used across millions of chips with materials that are 99.999999999% pure.
By this criteria, in the entire world, only US and UK seem to do capitalism properly. Whether the current age of tech companies survive till 2050s is to be seen, (we are already seeing signs of OpenAI, Anthropic joining them but it is to be said if the existing monopolies of say Microsoft will be disrupted).
In other countries, big companies have been the same for hundreds of years, from Japan to Germany to Korea to India. This is no longer capitalism as much as it is some soft form of Feudalism, where the same set of families hold power for generations at a time till some major fortune swings occur.
> Aoki’s key insight was that the J-mode had a comparative advantage in environments of moderate volatility: situations where conditions changed frequently enough that rigid central plans would be outdated before they were executed, but not so radically that only top-down strategic intervention could cope. In an environment of stable, predictable demand, the H-firm did fine; in an environment of extreme disruption, where the whole product line had to be rethought, centralized authority was indispensable, and the H-firm also did fine. But in between—where the challenge was to make constant small adjustments in a changing but recognizable paradigm—the J-firm excelled.
See for example https://aakashgupta.medium.com/microsofts-ceo-just-became-a-... or https://www.bloomberg.com/news/newsletters/2025-06-12/zucker...
Oh we had that level of conglomerates. Deutsche Bank and Allianz as capital providers, Siemens, AEG, Thyssen, Krupp, Mannesmann and a bunch of others formed the so-called "Deutschland AG" [1] - a web of interconnected very large companies, that also had very good ties to politics.
It was a better time.
[1] https://de.wikipedia.org/wiki/Deutschland_AG
dumb example: it does computer chips (graviton cpus), it does backpacks and stationary (stuff under the "amazon basics" brand), it does editorial work (amazon self-publishing), it does satellite communications. oh and cloud computing and more and more stuff.
Two thoughts:
- Japanese management style and processes are probably fruitful ground for understanding how teams of agents should work. H-firms require inspirational leadership, and agents don't need that.
- There is an interesting opportunity to turn Japanese process knowledge into a trainable environment, which of course should be done in such a way to benefit Japan and the Japanese people ("The type of deep process knowledge that has accreted within companies like Kyocera and Toto is almost impossible to replicate")
What, no mention of their personal massagers?
Vertical integration is almost looked like a mistake in the western investor driven companies; and inventions are to be bought, not actually made, why risk research money into anything not deemed "core business" by the market ?
An example would be "super apps". If you google this term you will see countless results that say "Chinese users prefer one app that does everything; they are also better at handling information density." The argument becomes: Super apps exist because Chinese users like Super apps. This is wrong. If you ever talk to a single Chinese user you will learn that none of them like these types of apps.
Read the comments here as an example: https://x.com/felixleezd/status/2039008846514119046
> "No it doesnt. As a Chinese, these apps are shitty to use and I struggle with finding what I need most of the time."
> 'Lol no.
> Its just bloat without careful thoughts.
> "We have this new product, pls add it to the main screen, pls send a notification to all our users to try it out, pls my promotion depend on it"
> You can get away with this for decades if the main moat is strong enough.'
> "I hate them, full of shitty ads and ads and ads. Basically, every app wants to lend you money, which is a total disaster."
There's not a single user that likes "super apps."
Then why do they exist? Because of the business environment. In the 2010s, post-iPhone and when smartphones became everyman's personal computing device, VC investment into China skyrocketed, culminating in 2015. Alibaba alone launched something like 50 new services during this decade. A few giant companies remained while the other startup tech companies failed; they divided the market among themselves, and in order to increase LTV per user they started bootstrapping their new services by putting links into them inside their existing platforms. Taobao adding links to Alipay and so on.
So "super apps" exist in China because of the business environment. The apps are literally designed by KPIs: get more users to click on this button and open this other service. It has so far been impossible for any startup to disrupt the BAT giants, so they can keep adding more and more services to the same apps and as a result they get more cluttered.
The reason I'm making the analogy about China is that the same is certainly true for Japan. It is a steady-state, non-dynamic market where companies that were created decades ago remain and can expand horizontally. It has nothing to do with Japanese culture.